Financial & Managerial Accounting 3rd Edition by Charles Horngren,Harrison, Walter,Suzanne Oliver

Exercise 25

Applying the entity concept, using the accounting equation for transaction analysis, and preparing financial statements
Arron Woody practiced accounting with a partnership for five years. Recently he opened his own accounting firm, which he operates as a professional corporation. The name of the new entity is Arron Woody, CPA, RC. Woody experienced the following events during the organizing phase of the new business and its first month of operations. Some of the events were personal and did not affect the business.

Requirements
1. Analyze the effects of the events on the accounting equation of the corporation of Arron Woody, CPA, RC. Use a format similar to Exhibit 1-6.
2. As of February 28, compute Arron Woody's
a. total assets.
b. total liabilities.
c. total stockholders' equity.
d. net income or net loss for February.