ND Paint Designs began operations on April 1, 2021. The company completed the following transactions in its

Question:

ND Paint Designs began operations on April 1, 2021. The company completed the following transactions in its first month:

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Instructions

a. For each transaction, indicate: (1) the basic type of account debited and credited (asset, liability, or owner?s equity); (2) the specific account debited and credited (Cash, Rent Expense, Service Revenue, etc.); and (3) whether each account is increased (+) or decreased (?), and by what amount. Use the following format, in which the first transaction is given as an example:

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b. Prepare a journal entry for each transaction.

Taking it further

Nazim doesn?t understand why a debit increases the cash account and yet a credit to N. Dhaliwal, Capital increases that account. He reasons that debits and credits cannot both increase account balances. Explain to Nazim why he is wrong.

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Related Book For  book-img-for-question

Accounting Principles Volume 1

ISBN: 978-1119502425

8th Canadian Edition

Authors: Jerry J. Weygandt, Donald E. Kieso, Paul D. Kimmel, Barbara Trenholm, Valerie Warren, Lori Novak

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