Exercise 233 Analyze the following transactions in terms of their effect on the

Question

Exercise 233 Analyze the following transactions in terms of their effect on the basic accounting equation. (1) Issued stock to investors for $20,000 in cash. (2) Purchased supplies on credit for $700. (3) Billed customers $1,000 for services provided. (4) Paid for supplies purchased in transaction 2. (5) Paid dividends of $300 cash to stockholders. (6) Received half from customers billed in transaction 3. (7) Received and paid utility bill for 100. Record each transaction by increasing (+) or decreasing () the dollar amount of each item affect is recorded. (If balance after calculations is 0 then please enter 0 for that field and all s Balance Balance Balance Balance Balance Balance Totals

Explanation / Answer

cash + accounts receivable + supplies = accounts payable + common stock + retained earning

1. 20000 + 0 + 0 = 0 + 20000 + 0

2. 0 + 0 + 700 = 700 + 0 + 0

3. 0 + 1000 + 0 = 0 + 0 + 1000

4. (700) + 0 + 0 = (700) + 0 + 0

5. (300) + 0 + 0 = 0 + 0 + (300)

6. 500 + (500) + 0 = 0 + 0 + 0

7. (100) + 0 + 0 = 0 + 0 + (100)

   $19400 + $500 + $700 = $0 + $20000 + $600

Note:-   services revenue of $1000 as revenue and utility of $100 as expense and dividend of $300 will go to Retained Earning Account as net income{1000 - 100} of $900 minus dividend of $300

Related Questions

Navigate

• Browse (All)
• Browse E
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.