Wildhorse Co., a computer services company, entered into these transactions during May 2017, its first month of operations. 1. Stockholders invested $33,000 in the business in exchange for common stock of the company. 2. Purchased computers for office use (recorded as Equipment) for $26,900 from Ladd on account. 3. Paid $3,100 cash for May rent on storage space. 4. Performed computer services worth $15,300 on account. 5. Performed computer services for Wharton Construction Company for $3,500 cash. 6. Paid Western States Power Co. $8,700 cash for energy usage in May. 7. Paid Ladd for the computers purchased in (2). 8. Incurred advertising expense for May of $3,400 on account. 9. Received $11,100 cash from customers for contracts billed in (4). Using the following tabular analysis, show the effect of each transaction on the accounting equation. Put explanations for changes to revenues or expenses in the right-hand column. (If a transaction causes a decrease in Assets, Liabilities or Stockholders' Equity, place a negative sign (or parentheses) in front of the amount entered for the particular Asset, Liability or Equity item that was reduced.) Also classify each entry accordingly advertising expense / service revenue /rent expense or utility expense ) Assets = Liabilities + Stockholders’ Equity Cash + Accounts Receivable + Equipment = Accounts Payable + Common Stock + Retained Earnings Revenues - Expenses

Assets = liability + Stack Holders Equity Explanation Cash + Accounts receivables + Equipment = Accounts Payable + Common stock + Retained Earnings Revenues - Expenses 1 33,000 33,000 Common Stock for Cash 2 26,900 26,900 Brought Equipment on accounts 3 -3100 3100 Storage Rent Paid 4 15,300 15,300 Revenue from computer service On accounts 5 3500 3500 Revenue from computer service for cash 6 -8700 8700 Paid For Utility Expense 7 -26900 -26900 Paid for computer purchased on accounts in 2nd row 8 3400 3400 Incurred Advertising expenses on accounts 9 11,100 -11,100 Cash received 11,100 out of 15,300 for the computer services which was performed on accounts 40,000 = 3400 + 36,600 .

Wildhorse Co., a computer services company, entered i…

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Assets

liability

Stack Holders Equity

Explanation

Cash

Accounts receivables

Equipment

Accounts Payable

Common stock

Retained Earnings

Revenues

Expenses

33,000

Common Stock for Cash

26,900

Brought Equipment on accounts

-3100

3100

Storage Rent Paid

15,300

Revenue from computer service On accounts

3500

Revenue from computer service for cash

-8700

8700

Paid For Utility Expense

-26900

Paid for computer purchased on accounts in 2nd row

3400

Incurred Advertising expenses on accounts

11,100

-11,100

Cash received 11,100 out of 15,300 for the computer services which was performed on accounts

40,000

3400

36,600

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