Ai Fang Co. opened as a new computer services business on August 1, 2025. During August, the following transactions occurred.

1. Shareholders invested ¥20,000 cash in the business in exchange for ordinary shares.

2. Purchased equipment for ¥2,000, paying ¥1,000 in cash and the balance on account.

3. Paid ¥600 cash for August office rent.

4. Purchased ¥500 of supplies on account.

5. Recognized revenue of ¥7,500, of which ¥4,000 is collected in cash with the balance to be collected later.

6. Paid for the supplies purchased in transaction (4).

7. Declared and paid ¥700 dividend.

8. Incurred utility expenses for the month on account ¥270.

9. Paid salaries of ¥2,800 for August.

10. Received ¥2,000 from Standard Bank—money borrowed on a note payable.

Instructions

a. Prepare a tabular analysis of the August transactions. The column headings should be as follows: Cash + Accounts Receivable + Supplies + Equipment = Notes Payable + Accounts Payable + Share Capital— Ordinary + Revenues – Expenses – Dividends.

b. Prepare an income statement and a retained earnings statement for August, and a statement of financial position at August 31, 2025, for Ai Fang Co.