Chapter 1, Problem 27BE

Transaction analysis (Learning Objective 5) 15-20 min.

Trina Lynch opened a medical practice titled Trina Lynch M.D., Inc. During July, the first month of operations, the business experienced the following events:

Jul 2	Lynch bought $80,000 of common stock in the business by opening a bank account in the name of Trina Lynch M.D., Inc.
6	The business paid $65,000 cash for land with the intention of building an office building on the land.
11	The business purchased medical supplies for $800 on account.
15	The business officially opened for business.
17	The business treated patients and earned service revenue of $12,000, receiving cash.
19	The business paid office rent, $2,400.
22	The business sold supplies to another doctor for $300 cash, the cost of those supplies.
25	The business received a $235 utility bill in the mail. The bill will be paid in 30 days.
30	The business paid $250 on account related to the July 11 purchase.

Requirement

1. 1. Analyze the effects of these events on the accounting equation of the medical practice of Trina Lynch M.D., Inc. Use headings for Cash, Medical Supplies, Land, Accounts Payable, Common Stock, Service Revenue, Rent Expense, and Utilities Expense.