Analyzing Transactions Using the Financial Statement Effects Template and preparing Financial Statements Schrand Aerobics, Inc., rents studio space (including a sound system) and specializes in offering aerobics classes. On January 1, 2015, its beginning account balances are as follows: Cash, $3,750; Accounts Receivable, $3,900: Equipment, 50; Notes Payable, 51,875; Accounts Payable, 5750Common Stock, 54,125: Retained Earnings, 5900; Services Revenue, 50; Rent Expense, 50; Advertising Expense, $0; Wages Expense, $o; Utilities Expense, 50; Interest Expense, 50. The following transactions occurred during January (1) Paid $450 cash toward accounts payable (2) Paid $2,700 cash for January rent (3) Billed clients $8,625 for January classes (4) Received $375 invoice from supplier for T-shirts given to January class members as an advertising promotion (5) Collected $7.500 cash from clients previously billed for services rendered (6) Paid $1,800 cash for employee wages (7) Received $510 invoice for January utilities expense (8) Paid $15 cash to bank as january interest on notes payable (9) Declared and paid 5675 cash dividend to stockholders (10) Paid $3,000 cash on January 31 to purchase sound equipment to replace the rental system Sunor Required (a) Using the financial statements effects template, enter January 1 beginning amounts in the appropriate columns of the first row. (Hint: Beginning balances for columns can include amounts from more than one account.) (b) Report the effects for each of the separate transactions through 10 in the financial statement effects template set up in part (a). Total all columns and prove that (1) assets equal liabilities plus equity at January 31, and (2) revenues less expenses equal net income for January Financial statement effects template Income statement Statement of stockholders' equity Balance sheet Contributed Liabilities Capital $ 0 + $ 0 $ D. 0 - 0 0 0 Note: Use negative signs with your answers, when appropriate. Balance Sheet Noncash Transaction Cash Asset Assets Heg, Balance 0.5 0 (11 Paid $450 cash toward accounts payable 0 - 0 (23 Paid rent in cash: $2,700 0 O- (3) Billed clients 58,625 0. 0 14 $375 invoice received for advertising 0- 15) Cash collected on account: 57.500 0 + O 16) Paid wages expense in cash: $1,800 O. 077 Invoiced for utility expense:5510 0 + 0 08 Paid $15 cash for interest on note 0+ 0 199 Paid 5675 cash dividend 0 (10) Paid $3.000 cash for sound equipment 0 + O TOTALS 0 0+ 0. 0 0 - 0 Income Statement Earned Capital Revenue Expenses - Net Income 0$ 0 - $ 0 0 O- 0 0 0 0 0 - 0 0 0 0 0 0 0- O 0 0 0- O- 0 0 0 0 0 0 0 - 0 0 0 O. 0 0 0 O 0 0 0 0. O- 0 O 0- O O + 0- 0+ O. 0 0+ 0. 0. O 0 0+ YUL Financial statement effects template Income statement Statemen Note: Do not use negative signs with any of your answers. Schrand Aerobics, Inc. Income Statement For Month Ended January 31, 2015 Services Revenue $ 0 Expenses Rent Expense - $ o Advertising Expense Wages Expense 0 Interest Expense 0 Utilities Expense 0 Total Expenses Net Income $ 0 0 0 Check (Enter dividends as a negative number.) Schrand Aerobics, Inc. Statement of Stockholders' Equity For Month Ended January 31, 2015 Common Stock Retained Earnings Total Stockholders' Equity Balance at January 1, 2015 $ 0 $ 900 $ 0 Stock Issuance 0 0 Dividends 0 0 0 Net Income 0 o Balance at January 31, 2015 $ 0 $ 0 $ 0 0 0 Check