Transaction analysis (Learning Objective 5 ) 5–10 min.

Selected transactions for Moe Company are listed below. List the number of the transaction and then describe the effect of each transaction on assets, liabilities, and stockholder’s equity.

Example: Bought shares of common stock in the business.

The answer would be: Increase in assets and increase in stockholder’s equity.

1. Paid monthly utility bill.

2. Purchased new display case for cash.

3. Paid cash for repair work on security system.

4. Billed customers for services performed.

5. Received cash from customers billed in (4).

6. Incurred advertising expenses on account.

7. Paid monthly rent.

8. Received cash from customers when service was rendered.

AppendixLO1