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Home Q & A Board Other Fields Homework Help Business Accounting
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vfairch vfairch
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6 years ago
Indicate the effects on the accounting equation of the following business transactions of Smith Service Company for b) to d) below. Use proper account titles. Transaction a) is answered as a guide.

a) Received cash from the owner, Don Smith as an investment in the business.
Answer:  Increase asset (Cash); Increase equity (D. Smith, Capital)
b) Purchased equipment; signed a note payable.
c) Performed services for a customer on account.
d) At the end of the first month, paid office rent.
Textbook 
Horngren's Accounting

Horngren's Accounting


Edition: 11th
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wrote...
#1
6 years ago
 Increase asset (Cash); Increase equity (D. Smith, Capital)
b) Purchased equipment; signed a note payable.
c) Performed services for a customer on account.
d) At the end of the first month, paid office rent.
Answer:
 b) Increase asset (Equipment); Increase liability (Note Payable)
c) Increase asset (Accounts Receivable); Increase equity (Service Revenue)
d) Decrease equity (Rent Expense); Decrease asset (cash)
vfairch Author
wrote...
#2
6 years ago
Oh god, I was lost before coming here. Thanksss
wrote...
#3
6 years ago
Great, make sure you mark the topic solved, it hides it from other eyes Slight Smile
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