Analyzing Transactions Using the Financial Statement EffectsTemplate Hanlon Advertising Company began the current month withthe following balance sheet.
| Cash | $ 80,000 | Liabilities | $ 70,000 |
| Noncash assets | 135,000 | Contributed capital | 110,000 |
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| Earned capital | 35,000 |
| Total assets | $215,000 | Total liabilities and equity | $215,000 |
Following are summary transactions that occurred during thecurrent month.
The company purchased supplies for $5,000 cash; none were usedthis month.
Services of $2,500 were performed this month on credit.
Services were performed for $10,000 cash this month.
The company purchased advertising for $8,000 cash; the ads willrun next month.
The company received $1,200 cash as partial payment on accountsreceivable from transaction 2.
The company paid $3,400 cash toward the accounts payablebalance reported at the beginning of the month.
Paid $3,500 cash toward this month's wages expenses.
The company declared and paid dividends of $500 cash.
(a) Record the effects of each transaction using the financialstatement effects template.
Use negative signs with your answers, when appropriate.
Balance Sheet
Transaction
Cash Asset+NoncashAssets=Liabilities+ContributedCapital+EarnedCapital
Income Statement
Revenu (minus) Expenses = Net income
Prepare the income statement for this month and the balancesheet as of month-end.
Do not use negative signs with any of your answers below.
Hanlon Advertising Company
Income Statement
| Sales revenue | 0 |
| Total expenses | 0 |
| Net income | 0 |
Hanlon Advertising Company
Retained Earnings Reconciliation
| Retained earnings. beginning of month | $0 |
| Add: Net income |
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| Less: Dividends |
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| Retained earnings. end of month | $0 |
Hanlon Advertising Company
Balance Sheet
| cash | $0 |
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| Noncash assets |
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| Total assets | $0 |
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| Liabilities | $0 |
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| Contributed capital | 0 |
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| Retained earnings | 0 |
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| Total equity | 0 |
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| Total liabilities and equity | $0 |
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