ZAMAN Consulting incorporated on August 1, 2021. The company engaged in the following transactions during its first month of operations:Aug. 1 Issued capital stock in exchange for $750,000 cash.Aug. 5 Borrowed $50,000 from the bank by issuing a note payable.Aug. 8 Purchased land, building, and office equipment for $600,000. The value of the land was $100,000, the value of the building was $450,000, and the value of the office equipment was $50,000. The company paid $300,000 cash and issued a note payable for the balance.Aug. 11 Purchased office supplies for $600 on account. The supplies will last for several months.Aug. 14 Paid the local newspaper $400 for a full-page advertisement. The ad will appear in print on August 18.Aug. 20 Several of the inkjet printer cartridges that ZAMAN purchased on August 11 were defective. The cartridges were returned and the office supply store reduced ZAMAN’s outstanding balance by $100.Aug. 22 Performed consulting services for $6,000 cash.Aug. 24 Billed clients $9,000.Aug. 25 Paid salaries of $5,000.Aug. 30 Paid the entire outstanding balance owed for office supplies purchased on August 11A partial list of the account titles used by the company includes:Cash Notes Payable Accounts Receivable Accounts PayableOffice Supplies Capital Stock Land Client Service RevenueBuilding Advertising Expense Office Equipment Salaries Expense
Required:Analyze the effects that each of these transactions will have on the following six components of the company’s financial statements for the month of August. Organize your answer in tabular form, using the column headings shown below. Use I for increase, D for decrease, and NE for no effect. The August 1 transaction is provided for you:Prepare journal entries, including explanations, for the above transactions.Post each entry to the appropriate ledger accounts (use the T account Format)Prepare a trial balance dated August 28, 2021. Assume accounts with zero balances are not included in the trial balance