Sefcik Company began operations on the first of October. Following are the transactions for its first month of business.
1. S. Sefcik launched Sefcik Company and invested $100,000 into the business in exchange for common stock. The company also borrowed $200,000 from a local bank.
2. Sefcik Company purchased equipment for $190,000 cash and inventory of $80,000 on credit (the company still owes its suppliers for the inventory at month end).
3. Sefcik Company sold inventory costing $60,000 for $100,000 cash.
4. Sefcik Company paid $24,000 cash for wages owed employees for October work.
5. Sefcik Company paid interest on the bank loan of $2,000 cash.
6. Sefcik Company recorded $1,000 of depreciation expense related to its equipment.
7. Sefcik Company paid a dividend of $4,000 cash.

a. Record the effects of each transaction using the financial statement effects template. b. Prepare the income statement and balance sheet at the end of October.