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FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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
Transcribed Image Text:"For each transaction a through f, identify its impact on the accounting equation (select from
1 through 5 below).
a.
The company pays cash toward an account payable.
b.
The company purchases equipment on credit.
С.
The owner invests cash in the business.
d.
The owner withdraws cash from the business.
е.
The company purchases supplies for cash.
f.
The company provides services for cash.
A.Decreases an asset and decreases equity.
B.Increases an asset and increases a liability.
C.Decreases an asset and decreases a liability.
D.Increases an asset and decreases an asset.
E.Increases an asset and increases equity."
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- Question: Which of the following is a fundamental accounting principle that states that businesses should only record transactions that can be expressed in monetary terms? A) Matching principle B) Materiality principle C) Monetary unit principle D) Conservatism principlearrow_forwardNeed Help please provide Solutionsarrow_forwardThe five primary activities of a business generally are: a.receiving cash, disbursing cash, buying assets, issuing dividends, and paying off liabilities. b.making a profit, issuing financial statements, repaying debts, issuing dividends to shareholders, and complying with laws and regulations. c.receiving assets, selling assets, issuing financial statements, collecting cash, and making cash disbursements. d.receiving assets, purchasing assets, selling goods or services, collecting cash from customers, and repaying owners and creditors.arrow_forward
- which of the following is an operating avtivity? A. billing customers for services rendered but not yet paid for B. paying off a loan to the bank C. purchasing equipment for cash D. receiving cash investments from ownersarrow_forwardHere is question The purpose of this assignment is for you to demonstrate your ability to record business transactions and then prepare a properly formatted income statement and balance sheet. The one additional requirement is that you answer the questions that you find below. Questions to be answer 1. What is the company's ending Cash balance? What is the company's ending Equity? Why is cash not equal to equity? 2. What is the company's net income for the period? 3. If you had to repay your creditors today, could you? Explain. 4. The company made a small amount of net income over the month. Explain why the equity actually decreased over the period. 5. You have recorded journal entries for the period of a month. If you were told that the business license in T12 was a annual expense, would this impact the reported net income? Explain why or why not.arrow_forwardaccounting records the impact of a business event when it occurs, regardless of whether the transaction affected casharrow_forward
- For each of the following independent transactions, indicate whether there was an Increase, a Decrease, or No Impact for each financial statement element. Transaction Assets Liabilities Owners' Equity Received cash from customer on account Borrowed cash from bank Received and recorded utility bill Paid dividends to owners Performed services and billed customer PLEASE NOTE: You are to use the following words - "Increase", "Decrease", or "No Impact" - when you fill in the blanks (Capitalize and omit the quotation marks).arrow_forwardA business provider services to a customer on credit.Which of the following is correct: A.Assets increase and liabilities decrease at the time the cash is collected B.Assets increase and liabilities increase at the time of the sale C.Assets increase and the owner's equity increases at the time the cash is collected D.Assets increase and the owner's equity increases at the time of the salearrow_forward
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