Use the following information to answer the questions.

Indicate the effect of each transaction during the month of October 2011 using the given accounting equation.

a. Opened a business bank account for Jones, Inc., with an initial deposit of $45,000 in exchange for capital stock. b. Paid rent on the office building for the month, $2,000 c. Received cash for fees earned of $5,000 d. Purchased equipment, $7,000 e. Paid salaries for the month, $1,000

Assets = Liabilities + Stockholders' Equity Cash Equipment Notes Payable Capital Stock Retained Earnings

For transaction B, what is the effect of the transaction on the accounting equation?(Points : 3)

Cash is decreased $2,000, Note Payable is decreased $2,000

Cash is decreased $2,000, Retained Earnings is decreased $2,000

Note Payable is decreased $2,000, Retained Earnings is decreased $2,000

Cash is decreased $2,000,Capital Stock is decreased $2,000