Explain briefly how each of the following transactions would affect acompany’s balance sheet. (Remember, assets must equal liabilities plusowners’ equity before and after the transaction.)
a. Sale of used equipment with a book value of $300,000 for $500,000cash.
b. Purchase of a new $80 million building, financed 40 percent withcash and 60 percent with a bank loan.
c. Purchase of a new building for $60 million cash.
d. A $40,000 payment to trade creditors.
e. A firm’s repurchase of 10,000 shares of its own stock at a price of$24 per share.
f. Sale of merchandise for $80,000 in cash.
g. Sale of merchandise for $120,000 on credit.h. Dividend payment to shareholders of $50,000.
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