The following single question has five parts:

What impact does each of the following transactions have on the financial statements?

Question 1: Paid rent for the current month.

Net income goes down; assets and stockholders'equity both go down.

Net income goes down; assets and liabilites both go down.

Net income goes down; liabilites go up and stockholders' equity goes down.

No effect on net income; assets and stockholders' equity both go down.

No effect on net income; assets go down and liabilites go up.

Question 2: Purchase of equipment on account.

Net income goes down; assets and liabilities both go up.

Net income goes down; assets and stockholders' equity both go down.

Net income goes up; assets and liabilities both go up.

No effect on net income; assets and liabilities both go up.

No effect on net income; assets and stockholders' equity both go up.

Question 3: Performed services and billed a customer.

Net income goes up; assets go both up and down.

Net income goes up; assets and liabilites both go up.

Net income goes up; assets and stockholders' equity both go up.

No effect on net income; assets go both up and down.

No effect on net income; assets and liabilities both go up.

Question 4: Paid off an amount due to a creditor.

Net income goes up; assets and liabilities both go up.

Net income goes up; assets and liabilites both go down.

No effect on net income; assets and liabilities both go up.

No effect on net income; assets and stockholders' equity both go down.

No effect on net income; assets and liabilities both go down.

Question 5: Received utility bill for the current month; the bill will be paid next month.

Net income goes down; assets and liabilites both go up.

Net income goes down; assets and liabilites both go down.

Net income goes down; assets and stockholders' equity both go down.

Net income goes down; liabilities go up and stockholders' equity goes down.

No effect on net income; assets and liabilities both go up.