Construct a balance sheet for Sophie's Sofas given the following data, including shareholders' equity. Cash balances $ 12,500 Inventory of sofas $ 225,000 Store and property $ 125,000 Accounts receivable $ 24,500 Accounts payable $ 19,500 Long-term debt $ 195,000

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Financial Transaction Analysis

The transaction analysis is done with the help of the accounting equation. The basic accounting equation is alternatively known as the balance sheet equation is based on the double-entry system which says that for each transaction happening in a business, at least two accounts should be affected I.e. both the debit side and the credit side should be equal. The Accounting Equation is