-
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ze the effect of transactions on
liabilities, and equity.
Instructions
List the numbers of the above transactions and describe the effect Ul
ties, and equity. For example, the first answer is: (1) Increase in assets and increa
E1.7 (LO 4) Collins Computer Timeshare entered into the following transactions during May 2025.
Cu
XH
1. Purchased computers for R$20,000 from Digital Equipment on account.
2. Paid R$4,000 cash for May rent on storage space.
3. Received R$17,000 cash from customers for contracts billed in April..
4. Performed computer services for Viking Construction for R$4,000 cash.
5. Paid Tri-State Power R$11,000 cash for energy usage in May.
6. Shareholders invested an additional R$29,000 in the business in exchange for ordinary shares.
B
7. Paid Digital Equipment for the computers purchased in (1) above.
Fran
8. Incurred advertising expense for May of R$1,200 on account.
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Instructions
Indicate with the appropriate letter whether each of the transactions above results in:
a. An increase in assets and a decrease
in assets.
b. An increase in assets and an increase
in equity.
c. An increase in assets and an increase
in liabilities.
d. A decrease in assets and a decrease in
truequity.
e. A decrease in assets and a decrease
in liabilities.
f. An increase in liabilities and a decrease
in equity.
g. An increase in equity and a decrease
in liabilities.
