P3.3A (LO 1, 2), AP Bindy Crawford created a corporation providing legal services, Bindy Crawford Inc., on July 1, 2022. 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.

Analyze transactions and prepare an income statement, retained earnings statement, and balance sheet.

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 any changes in Retained Earnings.

Cash

$7,150

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

Net income	$2,570
Ret. earnings	$3,470