2024 – The following cash transactions took place during March the first month of business for Cats and

The following cash transactions took place during March, the first month of business for Cats and Dogs Company:

1.     D.C. Dawg started a business, Cats and Dogs Company, by contributing $6,000.

2.     The Cats and Dogs Company borrowed $2,000 from the bank on March 1. The note is a 1-year, 12% note, with both principal and interest to be repaid on February 28 of next year.

3.     The company earned $900 in revenue.

4.     Expenses amounted to $650.

5.     Distributions to owners amounted to $25.

You are to complete the following tasks:

 

1.     Show how each cash transaction affects the accounting equation.

2.     Give one additional piece of information related to the transaction that could be recorded in an information system for a purpose other than the financial statements.

3.     Prepare the four basic financial statements for the month of March.