Han$$s Supplies$$s bank statement contained a $$430$ NSF check that one of its customers had written to pay for supplies purchased.

Required:

a$.$ & c$.$ Show the effects of the following transactions on the financial statements in the horizontal statements model. $($a$)$ Recognize the NSF check, $($c$)$ Customer redeems the check by giving Hans $$450$ cash in exchange for the bad check. The additional $$20$ was a service fee charged by Hans.

Note: Enter any decreases to account balances with a minus sign. For changes on the Statement of Cash Flows, indicate whether the item is an operating activity $($OA$),$ investing activity $($IA$),$ financing activity $($FA$),$ or leave the cell blank if there is no effect.

b$.$ Is the recognition of the NSF check on Han$$s books an asset source, use, or exchange transaction?

multiple choice $1$

Asset source

Asset use

Asset exchange

d$.$ Select which of the following is the correct answer.

multiple choice $2$

Asset exchange is $$450.$

Asset source is $$450.$

Asset use is $$450.$

Asset exchange is $$430$ and Asset source is $$20.$

Asset source is $$430$ and Asset use is $$20.$

Asset exchange is $$450$ and Asset use is $$20.$