Bindy Crawford created a corporation providing legal services, Bindy Crawford Inc., on July 1,2025 . On July 31 the balance sheet showed Cash \(\$ 4,000\), Accounts Receivable \(\$ 2,500\), Supplies \(\$ 500\), Equipment \(\$ 5,000\), Accounts Payable \(\$ 4,200\), Common Stock \(\$ 6,200\), and Retained Earnings \(\$ 1,600\). During August, the following transactions occurred.

Aug. 1 Collected \(\$ 1,100\) of accounts receivable due from customers.

4 Paid \(\$ 2,700\) cash for accounts payable due.

9 Performed services worth \(\$ 5,400\), of which \(\$ 3,600\) is collected in cash and the balance is due in September.

15 Purchased additional office equipment for \(\$ 4,000\), paying \(\$ 700\) in cash and the balance on account.

19 Paid salaries \(\$ 1,400\), rent for August \(\$ 700\), and advertising expenses \(\$ 350\).

23 Paid a cash dividend of \(\$ 700\).

26 Borrowed $5,000 from American Federal Bank; the money was borrowed on a 4-month note payable.

31 Incurred utility expenses for the month on account \(\$ 380\).

Instructions

a. Prepare a tabular analysis of the August transactions beginning with July 31 balances. The column heading should be Cash + Accounts Receivable + Supplies + Equipment \(=\) Notes Payable + Accounts Payable + Common Stock + Retained Earnings + Revenues - Expenses - Dividends. Include margin explanations for revenues and expenses.

b. Prepare an income statement for August, a retained earnings statement for August, and a classified balance sheet at August 31.