Selected transactions for Thyme Advertising Company, Inc. are listed here Descri

Question

Selected transactions for Thyme Advertising Company, Inc. are listed here

Describe the effect of each transaction on assets, liabilities, and stockholders’ equity.

Issued common stock to investors in exchange for cash received from investors.

Paid monthly rent.

Received cash from customers when service was performed.

Billed customers for services performed.

Paid dividend to stockholders.

Incurred advertising expense on account.

Received cash from customers billed in (4).

Purchased additional equipment for cash.

Purchased equipment on account.

Issued common stock to investors in exchange for cash received from investors.

Explanation / Answer

1 Answer:- Increase in assets, Increase in stock holders equity.

2 Answer:- Decrease in assets (cash), Decrease in stockholders equity (expenses)

3 Answer:- Increase in assets (cash), Increase in stockholders equity (Revenue)

4 Answer:- Increase in assets, Increase in liabilities

5 Answer:- Decrease in stockholders equity, Decrease in assets (cash)

6 Answer:- Increase in liabilities

7 Answer :- Increase in assets (cash), Decrease in assets (Account Receivable)

8 Answer:- Decrease in assets (cash), Increase in assets (equipment)

9 Answer:- Increase in liabilities (accounts payable), Increase in assets (equipment)

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