1. Please write a four-to-six sentence paragraph on the following question. Describe each of the four basic financial statements. What is the relationship between them?

The four basic financial statements are the: balance sheet, income statement, cash flow statement, and the equity statement. With the balance sheet, this gives the overall view of a company’s financial situation, showing whether or not the company is performing positively or negatively. Income statements show the net income of a company – which is the amount of money the company takes in after all expenses and taxes. The cash flow statement shows whether or not there is an increase or decrease in a company’s cash flow. Lastly, the equity statement basically shows the equity , or value of each share for shareholders and/or owners.

2. During the first month of operations (March 2015), Jerry Enterprises completed the following selected transactions:
a. The business received $12,000 in cash and a building valued at $52,000 from investors. The corporation issued common stock to these investors.
b. Borrowed $15,800 from the bank and signed a note payable with the bank.
c. Paid $12,000 for equipment purchased.
d. Purchased supplies on account for $200.
e. Paid employees’ salaries of $2,100.
f. Performed services for customer on account, $2,800.
g. Paid $100 of the accounts payable that were due from Transaction (d) above.
h. Received an $800 bill for advertising expenses that will be paid in the near future.
i. Received cash on account, $1,600 (for work performed earlier in Transaction (f) above).
j. Paid rent of $1,200.

Required:
1. Prepare the journal entries for the above transactions.
2. Prepare the trial balance sheet of Jerry Enterprises as of March 31, 2015.

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Account Names Debit Credit Cash 12,000 .