Analyzing effects of transactions Nico Mitchell started a new business, Nicos Solutions, that completed the following transactions

Question:

Analyzing effects of transactions Nico Mitchell started a new business, Nico’s Solutions, that completed the following transactions during its first year of operations.

a. N. Mitchell invests $$70,000$ cash and office equipment valued at $$10,000$ in the business.

b. Purchased a $$150,000$ building to use as an office. The company paid $$20,000$ in cash and signed a note payable promising to pay the $$130,000$ balance over the next ten years.
¢. Purchased office equipment for $$15,000$ cash.

d. Purchased $$1,200$ of office supplies and $$1,700$ of office equipment on credit.

e. Paid a local newspaper $$500$ cash for printing an announcement of the office’s opening.

f. Completed a financial plan for a client and billed that client $$2,800$ for the service.
g- Designed a financial plan for another client and immediately collected a $$4,000$ cash fee.
h. Mitchell withdrew $$3,275$ cash for personal use.
i. Received $$1,800$ cash from the client described in transaction ip j- Made a $$700$ cash payment on the equipment purchased in transaction d.
Kk. Paid $$2,300$ cash for the office secretary's wages.

Required

1. Create a table like the one in Exhibit 2.1, using the following headings for the columns: Cash; Accounts Receivable; Office Supplies; Office Equipment; Building; Accounts Payable; Notes Payable; N.
Mitchell, Capital; N. Mitchell, Withdrawals; Revenues; and Expenses.
2. Use additions and subtractions to show the effects of these transactions on individual items of the accounting equation. Show new balances after each transaction.
3. Once you have completed the table, determine the company’s net income.

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