Exercise 3-6A Identifying transaction type, its effect 011 the accounting equation, and whether the effect is recorded with a debit or credit

Required Id ent ify whether each of the follow ing tra nsactio ns is an asse t so urce (AS). asset use (AU) , asset exchange (A E), or claims exchange (C E). Also e xplai n how each event afTects th e acco untin g eq uatio n by placing a + for increase, - for decrease. a nd NA for 1101 affec1ed under each of the co mpo nent s of the acco unt in g eq uatio n. Fina lly, in dicate whet her the efTec t req uires a debit or cred it ent ry. The first event is reco rded as an examp le.

Stockholders Equity

Event

a

Type of Event AS

Assets + Debit

Liabilities + NA

Common Stock NA

Retained + Earnings + Credit

a. P rov id ed se rvices on acco un t. b. Rece ived cash in payment of accounts receivable. c. Pur c hased la nd by paying cas h. d. Recognized revenue for services co mple ted: cash collected previo usly. e. Paid a cash dividend to t he stock holde rs. f. Paid cash in ad vance for o ne year's rent. g. Received cash for services lo be performed in the future. h. 1ncurred other o perat in g expenses o n acco unt. i. Paid sala rie s pa yable. j. Recognized expense for prepaid rent that had been used up by the end of th e accounting period. k. Provided service s for cas h. I. P urchased supplie s on accoun t.. m. Recognized expense for supplies used d ur ing the period. n. Recog nized accrued int erest revenue.