Problem 2-9A Effect of Transactions on Accounting Equation eBook [Learning Objective 3](http://vrle.go.galegroup.com/vrle/start.do?pid=441617&sectionName=Analyzing+Business+Transactions&token=4B5953A5CD8EA54CD371A8AFEA7A87EF0C22A3A90B16DBACC3FE6276FB1D5A

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Problem 2-9A
Effect of Transactions on Accounting Equation

eBook Learning Objective 3 Learning Objective 4

Jay Pembroke started a business. During the first month (April 20--), the following transactions occurred.

Invested cash in business, $18,000.
Bought office supplies for $4,600: $2,000 in cash and $2,600 on account.
Paid one-year insurance premium, $1,200.
Earned revenues totaling $3,300: $1,300 in cash and $2,000 on account.
Paid cash on account to the company that supplied the office supplies in transaction (b), $2,300.
Paid office rent for the month, $750.
Withdrew cash for personal use, $100.

Required:

Show the effect of each transaction on the individual accounts of the expanded accounting equation: Assets = Liabilities + Owner's Equity (Capital - Drawing + Revenues - Expenses). After transaction (g), report the totals for each element. If an amount box does not require an entry, leave it blank.

Assets

Liabilities

Owner's Equity

Cash

Accounts Receivable

Office Supplies

Prepaid Insurance

Accounts Payable

J. Pembroke, Capital

J. Pembroke, Drawing

Revenues

Expenses

Description

[removed][removed]

Bal.

[removed][removed]

Demonstrate that the accounting equation has remained in balance.

Cash	$[removed][removed]
Accounts receivable	[removed][removed]
Office supplies	[removed][removed]
Prepaid insurance	[removed][removed]
Total Assets	$[removed][removed]

Accounts payable	$[removed][removed]
Jay Pembroke, capital	[removed][removed]
Jay Pembroke, drawing	[removed][removed]
Service fees	[removed][removed]
Rent expense	[removed][removed]
Total Liabilities and Owner's Equity	$[removed][removed]