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Wildhorse Co. entered into these transactions during May 2017, its first month of operations.

(1) Stockholders invested $31,500 in the business in exchange for common stock of the company
(2) Purchased computers for office use for $33,800 from Ladd on account.
(3) Paid $4,100 cash for May rent on storage space.
(4) Performed computer services worth $18,600 on account.
(5) Performed computer services for Wharton Construction Company for $6,400 cash.
(6) Paid Western States Power Co. $8,000 cash for energy usage in May.
(7) Paid Ladd for the computers purchased in (2).
(8) Incurred advertising expense for May of $3,100 on account.
(9) Received $11,000 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 Stockholders' Equity in the far right column.

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TomShelby

Answer:

attached answer

Explanation:

equity represnet investment from owners and the accumulation of the result from the company operations.

1) equity increase the company receive an investment from owner

3-6-8) equity decrease as an expense is incurred which is a negative operation it has a negative impact on the earnings of the firm

4-5-9) the company's equity increase as income is generated from the main activity.

2-7)there is no involment of equity as the company acquired an asset and takes a liability while then, at payment an asset(cash) decrease an a liability( A/P) also decrease

We must remember that we work with accrual accounting thus, the day of collection or payment are not what determinates ncome and expenses.

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