The following transactions occurred during March 2016 for the Wainwright Corporation. The company owns and operates a wholesale warehouse.
1. Issued 30,000 shares of common stock in exchange for $300,000 in cash.
2. Purchased equipment at a cost of $40,000. $10,000 cash was paid and a note payable was signed for the balance owed.
3. Purchased inventory on account at a cost of $90,000. The company uses the perpetual inventory system
4. Credit sales for the month totaled $120,000. The cost of the goods sold was $70,000
5. Paid $5,000 in rent on the warehouse building for the month of March
6. Paid $6,000 to an insurance company for fire and liability insurance for a one-year period beginning April 1, 2016
7. Paid $70,000 on account for the merchandise purchased in 3
8. Collected $55,000 from customers on account
9. Recorded depreciation expense of $1,000 for the month on the equipment.
Required:
Analyze each transaction and show the effect of each on the accounting equation for a corporation.
(Amounts to be deducted should be indicated by a minus sign. Enter the net change on the accounting equation.)