Analyzing the effects of transactions on the accounting equation.
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INSTRUCTIONS
Analyze the following transactions. Use the fundamental accounting equation form to record the changes in property, claims of creditors, and owner’s equity. (Use plus, minus, and equals signs.)
TRANSACTIONS
1. The owner invested $18,000 in cash to begin the business.
2. Purchased equipment for $8,000 in cash.
3. Purchased $3,000 of additional equipment on credit.
4. Paid $1,500 in cash to creditors.
5. The owner made an additional investment of $3,000 in cash.
6. Performed services for $2,160 in cash.
7. Performed services for $1,560 on account.
8. Paid $1,300 for rent expense.
9. Received $1,100 in cash from credit clients.
10. Paid $1,550 in cash for office supplies.
11. The owner withdrew $2,000 in cash for personal expenses.
Analyze: Which transactions increased the company’s debt? By what amount?
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