The following are the transactions of spotlighter, inc., for the month of january a. borrowed $3,940 from a local bank on a note due in six months. b. received $4,630 cash from investors and issued common stock to them. c. purchased $1,000 in equipment, paying $200 cash and promising the rest on a note due in one year. d. paid $300 cash for supplies. e. bought and received $700 of supplies on account. prepare a classified balance sheet for spotlighter inc., as of january 31.

BALANCE SHEETS31 Jan

Cash  $8,070

Supplies  $1,000

TOTAL CURRENT ASSETS   $9,070  

Property and Equipment  $1,000

TOTAL NONCURRENT ASSETS   1,000  

TOTAL ASSETS   $10,070  

Notes Payable  $4,740

Accounts Payable $0,700

TOTAL CURRENT LIABILITIES  $5,440

TOTAL NONCURRENT LIABILITIES  $0,000

TOTAL LIABILITIES  $5,440

Common Stock  $4,630

TOTAL EQUITY  $4,630

TOTAL EQUITY & LIABILITIES  $10,070

Explanation:

a. Borrowed $3,940 from a local bank on a note due in six months

Debit$3,940Cash

Credit$3,940Notes Payable

b. Received $4,630 cash from investors and issued common stock to them

Debit$4,630Cash

Credit$4,630Common Stock

c. Purchased $1,000 in equipment, paying $200 cash and promising the rest on a note due in one year.

Debit$1,000Equipment

Credit$0,200Cash

Credit$0,800Note Payable

d. Paid $300 cash for supplies

Debit$0,300Supplies

Credit$0,300Cash

e. Bought and received $700 of supplies on account

Debit$0,700Supplies

Credit$0,700Accounts Payable

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