For each of the following transactions of Spotighter, Inc., for the month of Jan

Question

For each of the following transactions of Spotighter, Inc., for the month of January, indicate the accounts amounts, and direction of the effects on the accounting equation. A sample is provided. (Enter decreases to account balances with a minus sign a. (Sample) Borrowed $4,540 from a local bank on a note due in six months b. Received $5,230 cash from investors and issued common stock to them c. Purchased $1,600 in equipment, paying $500 cash and promising the rest on a note due in one year d. Paid $600 cash for supplies e. Bought and received $1,000 of supplies on account Assets a Cash 4Noes Poyable (short-term)

Explanation / Answer

S. No. Assets = Liabilities + Stockholder's Equity a Cash 4,540 Notes Payable(Short Term) 4,540 b Cash 5,230 Common Stock(Shareholder's Fund) 5,230 c Cash -500 Equipment(Fixed Assets) 1,600 Notes Payable(Short Term) 1,100 d Cash -900 Supplies 900 e Supplies 1,000 Accounts Payable(Short Term) 1,000

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