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Write out each transaction in accounting equation format showing account titles and amounts and then determine the effect (if any) of that transaction on the income statement.
Choose the letter that matches your analysis from the table provided.You may use letters more than once or not at all. TYPE JUST THE LETTER IN THE ANSWER BOX.
This content is copyrighted- Note that “no transaction” means NO transaction needs to be recorded.
- Choice B: If one asset increases and another decreases by the same amount, that is B, not J. The order of the + and minus does not matter.
Assets
Liabilities
Equity
Net Income
A
+ + ne ne B
+ , – ne ne ne C
+ ne + ne D
+ ne + + E
ne – + + F
– ne – – G
– – ne ne H
ne + – – I
– ne – ne J
no transaction
A law firm that prepares monthly financial statements. The following transaction took place in November.
This content is copyrighted- On November 5,The shareholders of the law firm contribute an additional $5,000 to the corporation in exchange for stock. ______
- On November 15, the company pays $8,000 for a six month lease that begins on December 1. _______
- On November 18, the company purchases $8,500 of office supplies on credit. __________
- On November 21, the company receives $1,000 for a legal consultation to be provided to a customer in December. __________
- On November 22, the company agrees to provide legal services for a trial in December. The client will pay the law firm $15,000 in December. ___________
