Exercise 2.3 (Static) Determining the effects of transactions on the accounting equation. LO 2-1, 2-2, 2-3...

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Exercise 2.3 (Static) Determining the effects of transactions on the accounting equation. LO 2-1, 2-2, 2-3 TRANSACTIONS 1. Paid $2,100 for utilities. 2. Performed services for $10,500 on account. 3. Received $6,500 from charge account customers. 4. Paid salaries of $4,500 to employees. 5. Paid $8,000 to a creditor on account. 6. Owner invested $90,000 in the business. 7. Purchased $26,700 of supplies on account. 8. Purchased equipment for $21,000 cash. 9. Paid $6,000 for rent (in advance). 10. Performed services for $7,800 cash. Indicate the impact of each of the transactions on the fundamental accounting equation (Assets = Liabilities Owner's Equity) by placing a "I" to indicate an increase and a "D" to indicate a decrease. The first transaction is entered as an example. Note: If transaction causes one account to increase and another to decrease within the same classification of the accounting equation, select I and D. Transaction Assets 1. D = 2. = I and D Owner's Liabilities + Equity + D I + 3. I and D I + 4. D = D + 5. D = 6. I = + + 7. = I > + I and D D D I I and D 8. I and D = 9. I and D = 10. I + + D + Exercise 2.3 (Static) Determining the effects of transactions on the accounting equation. LO 2-1, 2-2, 2-3 TRANSACTIONS 1. Paid $2,100 for utilities. 2. Performed services for $10,500 on account. 3. Received $6,500 from charge account customers. 4. Paid salaries of $4,500 to employees. 5. Paid $8,000 to a creditor on account. 6. Owner invested $90,000 in the business. 7. Purchased $26,700 of supplies on account. 8. Purchased equipment for $21,000 cash. 9. Paid $6,000 for rent (in advance). 10. Performed services for $7,800 cash. Indicate the impact of each of the transactions on the fundamental accounting equation (Assets = Liabilities Owner's Equity) by placing a "I" to indicate an increase and a "D" to indicate a decrease. The first transaction is entered as an example. Note: If transaction causes one account to increase and another to decrease within the same classification of the accounting equation, select I and D. Transaction Assets 1. D = 2. = I and D Owner's Liabilities + Equity + D I + 3. I and D I + 4. D = D + 5. D = 6. I = + + 7. = I > + I and D D D I I and D 8. I and D = 9. I and D = 10. I + + D +

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