March 2: Received
contributions of $20,000 from each of the two principal owners of the new
business in exchange for shares of stock.

March 7: Signed
a two-year promissory note at the bank and received cash of $15,000. Interest,
along with the $15,000, will be repaid at the end of the two years.

March 12: Purchased
$700 in miscellaneous supplies on account. The company has 30 days to pay for
the supplies.

March 19: Billed
a client $4,000 for services rendered by Expert in helping to install a new
computer system. The client is to pay 25% of the bill upon its receipt and the
remaining balance within 30 days.

March 20: Paid
$1,300 bill from the local newspaper for advertising for the month of March.

March 22: Received
25% of the amount billed to the client on March 19.

March 26: Received
cash of 2,800 for services provided in assisting a client in selecting software
for its computer.

March 29: Purchased
a computer system for $8,000 cash.

March 30: Paid
$3,300 of salaries and wages for March.

March 31: Received
and paid $1,400 in gas, electric, and water bills.

Required:

1. Prepare a
table to summarize the preceding transactions as they affect the accounting
equation. Use the format in Exhibit 3-1. Identify each transaction with the
date.

2. Prepare
an income statement for the month ended March 31, 2010.

3. Prepare a
classified balance sheet at March 31, 2010.

4. From
reading the balance sheet you prepared in 93), what events would you expect to
take place in April?

Explain your answer.