Consider the three transactions shown in the financial statement effects template, below. Match each transaction to the descriptions that follow.
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Balance Sheet
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Income Statement
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Transaction
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Cash Asset
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+
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Noncash Assets
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=
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Liabil-
ities
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+
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Contrib. Capital
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+
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Earned
Capital
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Rev-enues
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–
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Expen-ses
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=
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Net
Income
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#1
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-75
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75
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=
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–
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=
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#2
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-75
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=
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-75
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–
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75
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=
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-75
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#3
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=
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75
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-75
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–
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75
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=
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-75
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a. Services of $75 were performed for cash.
b. Inventory of $75 was purchased for cash.
c. Wages of $75 were accrued at the end of the period.
d. Wages of $75 were paid in cash.
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Transaction
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Description (a, b, c, or d)
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#1
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#2
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#3
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Record the following transactions in the financial statements effects template below.
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Balance Sheet
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Income Statement
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|
Transaction
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Cash Asset
|
+
|
Noncash Assets
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=
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Liabil-
ities
|
+
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Contrib. Capital
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+
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Earned
Capital
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Rev-enues
|
–
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Expen-ses
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=
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Net
Income
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Purchase $10,000 of inventory on credit
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=
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–
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=
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Sell all inventory for $18,000 on account
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=
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–
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=
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Collect $4,000 cash for accounts receivable
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=
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–
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=
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Pay $6,000 cash toward accounts payable
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=
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–
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=
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