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a. 3 Practice entry 4 A piece of kitchen equipment is purchased for $1,500. 5 b. $2,000 in cash is borrowed from a local bank. 6 c. $10,000 is invested in the business by the owner. 7 d. A note payable is created to repay an accounts payable (AP). 8 e. An accounts payable amount owed to a vendor is paid in cash. 9 f. A dividend is declared but not yet paid. 10 g Cash is withdrawn by the owner of the business. Long-term debt owed to a sole proprietor is converted to owners' 11 h. equity 12 i. Preferred stock in a company is converted to common stock. 13 14 Transaction Transaction Impact 15 Increase an asset and increase an owner's equity account 16 Decrease an asset and decrease an owner's equity account Increase an asset and increase a liability 18 Decrease a liability and decrese an asset 19 Increase one asset and decrease another asset Increase an owner's equity account and decrease another owner's 20 equity account 21 Increase a liability and decrease an owner's equity account 22 Increase one liability and decrease another liability 23 Decrease a liability and increase an owner's equity account 24 25 26 27 17