Transactions made by Callahan and Co., a law firm, for the month of March are shown below. Prepare a tabular analysis which shows the effects of these transactions on the accounting equation, similar to that shown in Illustration 1-9.

1. The company provided $23,000 of services for customers, on credit.
2. The company received $23,000 in cash from customers who had been billed for services (in transaction 1).
3. The company received a bill for $2,000 of advertising, but will not pay it until a later date.
4. The company paid a dividend of $5,000 in cash tostockholders.

Transcribed Image Text:

Assets - Liabilities+ Stockholders' Equity Trans- Accounts+Supplies + EquipmentPayable StockRev Retained Earnines action Cash (1) +$15,000 +$15,000 Issued Stock (2) 7,000 (4) 1,200 (6) 1,500 +$2,000 +$7,000 +$1,600 +$1,600 +$1,200 Service Revenue Advert. Expense Service Revenue Rent Expense Sal./Wages Exp. Utilities Expense +250 -$250 +3,500 (7) 1,700 -600 -900 -200 -250 +600 1,300 -250 -600 1,300 Dividends $8,050+ $1,400+ $1,600+ $7,000= $1,600+ $15,000+ s4,700-$1,950-$1,300 $18,050 $18,050