Exercise 2.3 Determining the effects of transactions on the accounting equation.

Indicate the impact of each of the transactions below on the fundamental accounting equation

(Assets = Liabilities + Owner’s Equity) by placing a “+” to indicate an increase and a “−” to indicate a decrease. The first transaction is entered as an example.

Assets = Liabilities + Owner's Equity Transaction 1 − −
TRANSACTIONS 1. Paid $2,100 for utilities.
2. Performed services for $10,500 on account.
3. Received $6,500 from charge account customers.
4. Paid salaries of $4,500 to employees.
5. Paid $8,000 to a creditor on account.
6. Owner invested $90,000 in the business.
7. Purchased $26,700 of supplies on account.
8. Purchased equipment for $21,000 cash.
9. Paid $6,000 for rent (in advance).
10. Performed services for $7,800 cash