Hobson Company had the following transactions relating to its accounts payable. Use the financial statement effects template to identify the effects (both amounts and accounts) for these transactions. a. Purchases $1,260 of inventory on credit. b. Sells inventory for $1,650 on credit. c. Records $1,260 cost of sales for transaction b. d. Receives $1,650 cash toward accounts receivable. e. Pays $1,260 cash to settle accounts payable.

Balance Sheet									Income Statement
Transaction	Cash Asset	+	Noncash Assets	=	Liabilities	+	Contrib. Capital	+	Earned Capital	Revenues		Expenses	=	Net Income
a.	Answer		Answer	=	Answer		Answer		Answer	Answer		Answer	=	Answer
	AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A		AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A		AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A		AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A		AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A	AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A		AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A
b.	Answer		Answer	=	Answer		Answer		Answer	Answer		Answer	=	Answer
	AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A		AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A		AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A		AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A		AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A	AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A		AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A
c.	Answer		Answer	=	Answer		Answer		Answer	Answer		Answer	=	Answer
	AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A		AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A		AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A		AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A		AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A	AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A		AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A
d.	Answer		Answer	=	Answer		Answer		Answer	Answer		Answer	=	Answer
	AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A		AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A		AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A		AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A		AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A	AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A		AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A
e.	Answer		Answer	=	Answer		Answer		Answer	Answer		Answer	=	Answer
	AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A		AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A		AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A		AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A		AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A	AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A		AnswerAccounts payableAccounts receivableCashCost of salesInterest expenseInterest revenueInventoryRetained earningsSalesN/A