E&Z Reader was founded in January 2017 to provide text reading and recording services. Selected transactions for E&Z Reader’s first month of business are as follows:
a. Issued shares to investors for $50,000 cash
b. Billed customers $10,500 for services performed in January
c. Purchased car for $24,500 for use in the business; paid in cash d. Purchased $2,400 of supplies on account
e. Received $7,500 cash from customers billed in transaction (b)
f. Used $1,500 in utilities, which will be paid in February
g. Paid employees $3,500 cash for work done in January
h. Paid $1,200 cash toward supplies purchased in transaction (d)
Required:
For each transaction, complete the following:
1. Give the name of the account being debited or credited.
2. Give the basic account type (A, L, SE, R, E).
3. Indicate whether the account is increased (+) or decreased (–) due to the transaction.
4. Indicate whether the account normally holds a debit or credit balance.
Transaction (a) has been given as an example.
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