When using a perpetual inventory system, the journal entry to record the cost of merchandise sold is 1 debit Cost of Merchandise Sold; credit Sales 2 3 4 debit Cost of Merchandise Sold; credit Merchandise Inventory debit Merchandise Inventory; credit Cost of Merchandise Sold No journal entry is made to record the cost of merchandise sold. 1. A business paid $5,000 to a creditor in payment of an amount owed. The effect of the transaction on the accounting equation was to 1. increase one asset, decrease another asset 2. increase an asset, increase a liability 3. decrease an asset, increase owner's equity 4. decrease an asset, decrease a liability The total assets and total liabilities of Paul's Pools, a proprietorship, at the beginning and at the end of the current fiscal year are as follows: Total assets Total liabilities Jan. 1 Dec. 31 $270,000 $475,000 205,000 130,000 Determine the amount of net income earned during the year. The owner withdrew $63,000 in cash during the year (no additional investments). Accounts $ Operating $23,760 Payable 4,375 Expense Accounts Office 8,490 2,470 Receivable Expense Cash 34,980 Supplies 9,230 Wages Fees Earned 96,435 26,580 Expense Furniture & 56,000 Drawing 36,170 Equipment Land 50,000 Capital 125,870 Accumulated Misc. 22,000 1,000 Depreciation Expense Using the information above, calculate the total dollar value of assets $