The following accounting equation worksheet shows the transactions for Internet Advertising, a corporation, for the first month of business October 2009.

Requirements
1. Analyze each transaction in the accounting equation worksheet and describe the underlying exchange that resulted in each entry.
2. Has the company been profitable this month? Explain.
3. Prepare an income statement for the month ended October 31, 2009.
4. Prepare a statement of shareholders€™ equity for the month ended October 31, 2009.
5. Prepare a statement of cash flows for the month ended October 31, 2009.
6. Prepare a balance sheet at October 31, 2009.
7. Calculate the current ratio at October 31,2009.

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Assets Liabilities Shareholders' Equity Contributed Capital Common stock Retained Earnings All other AII TransactionCash assets (Account) labilities (Account) (Account) a. $17,250 $17,250 b. 16,900 16,900 Long-term notes payable C. (4,500) (4,500) Salary d. ,500 Accounts 3,000 Service revenue 1,500 receivable 8,000 Supplies 8,000 Accounts e. payable 8,1501,850 Accounts 10,000 Service evenue receivable 1,000 (1,000) Accounts receivable h. (5,000) (5,000) Accounts payable (4,100) 4,100) Operating (165) (165) Dividends