Question 2 - Analysing business transactions. (10 marks)

The following table contains several business transactions for the current month.

Required:Identify the names of which accounts are affected, how they are affected (+/-, increase or decrease), and the element of the financial statement of these accounts (A, L, OE, R, E).

Business Transactions

The owner contributed $30,000 cash to commence the business.

Purchased computer equipment for $18,000 on credit.

Cash received for services provided $6,900.

Borrowed $40,000 from the bank to be repaid in 5 years.

Paid $250 cash for advertising expense for the current month.

Account name

+/- (Increase/

decrease)

Element

Account name

+/- (Increase/

decrease)

Element