Keystone Computer Timeshare Company entered into the following transactions during May 2022.

1. Purchased computers for $20,000 from Data Equipment on account.

2. Paid $3,000 cash for May rent on storage space.

3. Received $15,000 cash from customers for contracts billed in April.

4. Performed computer services for Ryan Construction Company for $2,700 cash.

5. Paid Midland Power Co. $11,000 cash for energy usage in May.

6. Stockholders invested an additional $32,000 in the business.

7. Paid Data Equipment for the computers purchased in (1) above.

8. Incurred advertising expense for May of $840 on account.

Instructions

Indicate with the appropriate letter whether each of the above transactions results in:

a. An increase in assets and a decrease in assets.

b. An increase in assets and an increase in stockholders’ equity.

c. An increase in assets and an increase in liabilities.

d. A decrease in assets and a decrease in stockholders’ equity.

e. A decrease in assets and a decrease in liabilities.

f. An increase in liabilities and a decrease in stockholders’ equity.

g. An increase in stockholders’ equity and a decrease in liabilities.

Analyze the effect of transactions.