On February 1, 2020 Mr. Ankit Started Cloud9 company, a wedding planning service. The
company had the following transactions in February.
(a) Naik invested ₹14,000 cash in the company’s share capital.
(b) Bought two pieces of office equipment for cash ₹6,000.
(c) Provided services for cash ₹9,000.
(d) Bought office supplies on credit ₹1,500.
(e) Billed customers for services ₹7,500.
(f) Used office supplies ₹800.
(g) Collected payment for customer billed in (e) ₹ 6,800.
(h) Paid for office supplies bought in (d) on account ₹1,200.
(i) Billed customers for services ₹2,100.
(j) Paid Naik’s salary ₹6,000.
(k) Paid office rent for February ₹600.
Required
1. Analyze the effect of transactions in February 2020 on the related asset, liability and
equipment items.
2. Prepare the company’s February 2020 balance sheet, statement of profit and loss, and
cash account.