Most transactions take place between two independent entities. How you record a particular transaction depends on whose

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Most transactions take place between two independent entities. How you record a particular transaction depends on whose perspective you take. For each of the following transactions, explain how it would affect the basic accounting equation of each entity.a. Loan from a bank: from the borrower's and the bank's perspectives
b. Cash sales: from the seller's and the customer's perspectives
c. Investment made by Company A in shares of Company B, with the shares being obtained directly from Company B: from Company A's and Company B's perspectives
d. Investment made by Company A in shares of Company B, with the shares being purchased through the Toronto Stock Exchange; that is, the shares had previously been issued by Company B and now trade in the stock market: from Company As and Company B's perspectives
e. Purchase of inventory on account: from the buyer's and the seller's perspectives
f. Deposit paid by a customer on the purchase of inventory to be delivered at a later time: from the supplier's and the customer's perspectives
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Financial Accounting A User Perspective

ISBN: 978-0470676608

6th Canadian Edition

Authors: Robert E Hoskin, Maureen R Fizzell, Donald C Cherry

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