Boomingdales, Inc., reported the following transactions:

1, Purchased $150 of equipment on account. The corporation has over $1 million in assets.

2, Sold merchandise at retail of $150,000 during the year on account. Customers returned $10,000 of merchandise at retail for credit on their accounts. (Ignore cost of goods sold.)

3, Received $40,000 in advance from customers.

4, Recorded annual depreciation of $280,000.

Required

a. Record the above transactions in the accounting equation. Set up separate account columns as needed.

b. Discuss the generally accepted accounting principles that guide accountants?

in recording each of these transactions properly?