Bearings & Brakes Corporation (B& B) was incorporated as a private company. The company's accounts included the following at June 30:

During the month of July, the company had the following activities:

a. Issued 6,000 shares of common stock for $ 600,000 cash.

b. Borrowed $ 60,000 cash from a local bank, payable in four years.

c. Bought a building for $ 166,000; paid $ 66,000 in cash and signed a three- year note for the balance.

d. Paid cash for equipment that cost $ 90,000.

e. Purchased supplies for $ 90,000 on account.

Required:

1. Analyze transactions (a)-(e) to determine their effects on the accounting equation. Use the format shown in the demonstration case on page 69.

2. Record the transaction effects determined in requirement 1 using a journal entry format.

3. Summarize the journal entry effects from requirement 2 using T- accounts.

4. Prepare a trial balance at July 31.

5. Prepare a classified balance sheet at July 31.

6. As of July 31, has the financing for B& B's investment in assets primarily come from liabilities or stockholders' equity?