Question: During 2014, its first year of operations as a delivery service, Loonie Corp. entered into the following transactions.
1. Issued shares of common stock to investors in exchange for $80,000 in cash.
2. Borrowed $65,000 by issuing bonds.
3. Purchased delivery trucks for $60,000 cash.
4. Received $16,000 from customers for services provided.
5. Purchased supplies for $4,700 on account.
6. Paid rent of $5,200.
7. Performed services on account for $10,000.
8. Paid salaries of $28,000.
9. Paid a dividend of $11,000 to shareholders.
Instructions
Using the following tabular analysis, show the effect of each transaction on the accounting equation. Put explanations for changes to Stockholders' Equity in the right-hand margin. Add up all of the entries to show how Assets = Liab + SE