Question

Show each of the following transactions in the accounting equation. Then, tell whether or not the original transaction as given is one that results in the recognition of revenue or expenses. a (Click the icon to view the transactions.) Enter the transactions in the accounting equation. (Use parentheses or a minus sign when entering account decreases. Use only the necessary input lines. Some of the account names will be abbreviated. ) Begin by entering transaction a. Chico Inc. paid its computer service technicians $70,000 in salaries for the month ended January 31. i More Info + Assets Account $ Shareholders' Equity Contributed Capital + Retained Earnings Account Account Liabilities Account a. Chico Inc. paid its computer service technicians $70,000 in salaries for the month ended January 31. Irving Oil used $8,000 worth of electricity in its headquarters building during March. Shell received the bill, but will not pay it until sometime in April. In 2011, Tools Depot's, FAS had $25 million in catalogue sales. Assume all sales were recorded as credit sales. Home Depot collected $56 million in interest and investment income during 2010. c. d. Print Done

Answer 1

Answer:-

a)						Shareholder's Equity
Assets		=	Liabilities		+	Contributed capital		+	Retained earnings
$	Account		$	Account		$	Account		$	Account
-70,000	Cash	=			+			+	-70,000	Salary expense
		=			+			+
b)
Assets		=	Liabilities		+	Contributed capital		+	Retained earnings
$	Account		$	Account		$	Account		$	Account
	Cash	=	8,000	Bills payable	+			+	-8,000	Electricity exp
		=			+			+
c)
Assets		=	Liabilities		+	Contributed capital		+	Retained earnings
$	Account		$	Account		$	Account		$	Account
25,000,000	Accounts receivable	=			+			+	25,000,000	Revenue
					+			+
d)
Assets		=	Liabilities		+	Contributed capital		+	Retained earnings
$	Account		$	Account		$	Account		$	Account
56,000,000	Cash	=			+			+	56,000,000	Interest and investment income
		=			+			+