Analyze transactions and prepare income statement, owner's equity statement, and balance sheet. (LO 3, 4, 5) Judi Salem opened a law office on July 1, 2017. On July 31, the balance sheet showed Cash $5,000, Accounts Receivable $1,500, Supplies $500, Equipment $6,000, Accounts Payable $4,200, and Owner's Capital $8,800. During August, the following transactions occurred. 1.Collected $1,200 of accounts receivable.
2.Paid $2,800 cash on accounts payable.
3.Recognized revenue of $7,500 of which $3,000 is collected in cash and the balance is due in September.
4.Purchased additional equipment for $2,000, paying $400 in cash and the balance on account.
5.Paid salaries $2,500, rent for August $900, and advertising expenses $400.
6.Withdrew $700 in cash for personal use.
7.Received $2,000 from Standard Federal Bank—money borrowed on a note payable.
8.Incurred utility expenses for month on account $270.