Question

Transactions Record the following transactions using the Accounting Equation Transaction 1. Purchased supplies for $750.00 on account. Transaction 2. Provided services of $8,000.00 to patients on account. Transaction 3. Paid a premium of $3,000.00 for a 3 year insurance policy. Transaction 4. Prepaid insurance expired $1,000.00. Transaction 5. Received $2,000.00 in advance of services yet to be performed. Transaction 6. Supplies used up $500.00. Transaction 7. Sold merchandise on account $20,000.00 terms 1/10,n/30. The cost of the merchandise was $14,000.00 Transaction 8. Received check for the amount due from sale in transaction 7. Customer was entitled to discount. Transaction 9. Purchased merchandise on account for $33,000.00 terms 2/10,n/30. Paid invoice in transaction 9. Payment made within discount period. Transaction 10.

Answer 1

Accounting Equation

Total assets= Total liabilities + Shareholders equity

Transaction No.	Inventory	Cash	Prepaid Insurance	Accounts receivable	Total ($)	=	Liability	Equity	Total ($)
1	750	0	0	0	750		750		750
Balance	750	0	0	0	750	=	750	0	750
2	0	0	0	8000	8000		0	8000	8000
Balance	750	0	0	8000	8750	=	750	8000	8750
3	0	(3000)	3000	0	0		0	0	0
Balance	750	(3000)	3000	8000	8750	=	750	8000	8750
4	0	0	(1000)	0	(1000)		0	1000	(1000)
Balance	750	(3000)	2000	8000	7750	=	750	7000	7750
5	0	2000	0	0	2000		2000	0	2000
Balance	750	(1000)	2000	8000	9750	=	2750	7000	9750
6	(500)	0	0	0	(500)		0	(500)	(500)
Balance	250	(1000)	2000	8000	9250	=	2750	6500	9250
7	0	0	0	20000	20000		0	20000	20000
Balance	250	(1000)	2000	28000	29250	=	2750	26500	29250
8	0	19800	0	(20000)	(200)		0	(200)	(200)
Balance	250	18800	2000	8000	29050	=	2750	26300	29050
9	33000	0	0	0	33000		33000	0	33000
Balance	33250	18800	2000	8000	62050	=	35750	26300	62050
10	0	(33340)	0	0	(32340)		(33000)	660	32340
Balance	33250	(13540)	2000	8000	29710	=	2750	26960	29710

Note:

Effect of any income statement related item is given in equity

For suppose,

Providing services of $8000 to patients on account is a service revenue. Thus it can be added to the equity and also expenses have been subtracted from the equity

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DO VOTE, ALL THE BEST

Answer 2

Transaction#	Assets	Liabilities	Shareholders' equity
1	+$750 (supplies)	+$750 (Accounts payable)
2	+$8,000 (Accounts receivable)		+$8,000 (Revenue)
3	-$3,00(Cash)                                                  +$2,000 (Prepaid insurance)		-$1000(expenses)
4	-$1,000 (insurance policy)		-$1,000(expenses)
5	+2,000(cash)	+$2,000(advance received)
6	-$500 (supplies)		-$500(Expenses)
7	+$20,000 (Accounts receivable) -$14,000 ( Inventory)		+$6.000 (Revenue)
8	-$20,000(Accounts receivable)       +$19,800(Cash)		-$200(expenses)
9	+$33,000 (Inventory)	+$33,000 (accounts payable)
10	-$32,340(cash)	-$33,000(Accounts payable)	+$660(revenue)
	$                                                12,710	$                                            2,750	$                             9,960