Question

Your Responses Write out the accounting equation. Assets-Liabilities:quity Write out the extended accounting equation. Assets-Liabililities capital revenue Expenses You have $56,309 in assets and $19,382 in liabilities. How much do you have in equity? You have $139,220 in liabilities and $589,300 in equity. How much do you have in assets? You ve $75,200 in equity and $185,329 in assets. How much do you have in liabilities? You produce an invoice for $350, increasing the Sales account. Show what other account is Increased using the extended accounting equation You pay a bill for $75, decreasing the Checking account. Show what other account is decreased using the extended accounting equation. You deposit a check for $2,000 from the company owner into the Checking account. Show the effect on the accounting equation using the extended accounting equation. Account Balances Assets $40,000 Liabilities - $10,000 Equity - $30,000 You write a check for $250 to make a payment on a loan. What are the new account balances?

Answer 1

Highlighted figures are the answers for 1 to 7.

Liabilities S.no Assets 1 $ 56,309.00 + Capital +Revenues S 36,927.00+ $ Expenses Explanation $ Assets = Liabilities + Capital $ 19,382.00 + 2 S 728,520.00 $ 139,220.00 $ 589,300.00 + $ - $ - Assets = Liabilities + Capital 3 $ 185,329.00 S110,129.00 - $ 75,200.00 $ $ Assets = Liabilities + Capital Increase in sale will ultimately results in increase in capital ie ( capital + revenue -expenses) therefore there will be an increase in assets. 4 $ 350.00 $ $ $ 350.00 Decrease in checking account will ultimately decrease the assets and $ 75.00 ultimately expensed to the capital account. 5 $ (75.00) This transaction will increase the capital and checking account as this is an infusion of capital 6 2,000.00 $ +$ 2,000.00

7 . New Account balances

Accounts Assets Liabilities Equity Balances $ 40,000.00 $ 10,000.00 $ 30,000.00 Loan Payment $ (250.00) $ (250.00) New Balances $ 39,750.00 $ 9,750.00 $ 30,000.00

Payment of loan will reduce the liability and assets as it will reduce the laon balance and check account balance.

Accounting equation : Assets = Liabilities + Equity

$39,750 = $9,750 + $ 30,000