Darrin Yanagisawa recently opened an accounting firm on October 1, which operates as a sole proprietorship. The name of the new entity is Darrin Yanagisawa, CPA. Yanagisawa experienced the following events during the organizing phase of the new business and its first month of operations in 2025:

Requirements 

1. Analyze the effects of the events on the accounting equation of Darrin Yanagisawa, CPA. Use a format similar to Exhibit F:1-5. Use the following accounts: Cash; Accounts Receivable; Supplies; Furniture; Accounts Payable; Yanagisawa, Capital; Yanagisawa, Withdrawals; Service Revenue; Rent Expense; and Utilities Expense.

2. Prepare the following financial statements:

a. Income statement for the month ended October 31, 2025.

b. Statement of owner’s equity for the month ended October 31, 2025.

c. Balance sheet as of October 31, 2025.

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Oct. 5 Yanagisawa deposited $31,000 in a new business bank account titled Darrin Yanagisawa, CPA. The business gave capital to Yanagisawa. Purchased office furniture for the office on account, $9,500. 6 Paid $200 cash for supplies for new office. 7 10 11 12 Consulted with tax client and received $3,000 for services rendered. Paid utilities, $150. Finished tax hearings on behalf of a client and submitted a bill for accounting services, $14,000. 18 Paid office rent, $1,900. 25 27 31 Received amount due from client that was billed on October 12. Paid full amount of Accounts Payable created on October 7. Yanagisawa withdrew cash of $8,000.