Reference no: EM132646524

During February 2015, Claude Sample who operates a sports clinic presented the following for the first month of his company's operation:

Feb 1. Sample invested $55,000 in the business by depositing it into the company's bank account.
Feb 2. Paid $46,000 cash for land.
Feb 3. Purchased medical supplies for $1,800 on account.
Feb 4. Officially opened for business.
Feb 5. During the month, Sample treated patients and earned service revenue of $8,000, receiving cash.
Feb 6. Paid cash expenses: employees' salaries, $1,600; office rent, $900;
utilities, $100.
Feb 7. Returned supplies purchased on the 3rd for the cost of those supplies, $700.
Feb 8. Paid $1,100 on account for purchases made on Feb 3.

Requirement:

Problem 1. Analyze the effects of these events on the accounting equation of the sports clinic. For example, the transaction increased asset and increased capital; the transaction increased expenses and decreased cash; the transaction increased asset and decreased asset; etc.

Problem 2. Prepare the journal entries to record the above transactions.

Problem 3. Post the transaction to the "T" accounts of the company and balance off each account.