A number of business transactions carried out by Smalling Manufacturing Company are as follows:a. Borrowed money from a bank.b. Sold land for cash at a price equal to its cost.c. Paid a liability.d. Returned for credit some of the office equipment previously purchased on credit but not yetpaid for. (Treat this the opposite of a transaction in which you purchased office equipment oncredit.)e. Sold land for cash at a price in excess of cost. (Hint: The difference between cost and salesprice represents a gain that will be in the company’s income statement.)f. Purchased a computer on credit.g. The owner invested cash in the business.h. Purchased office equipment for cash.i. Collected an account receivable.Indicate the effects of each of these transactions on the total amounts of the company’s assets,liabilities, and owners’ equity. Organize your answer in tabular form, using the following columnheadings and the code letters I for increase, D for decrease, and NE for no effect. The answer fortransaction a is provided as an example: Transaction Assets Liabilities Owners’ Equity(a) I I NE
A number of business transactions carried out by Smalling Manufacturing Company are as follows:
a. Borrowed money from a bank.
b. Sold land for cash at a price equal to its cost.
c. Paid a liability.
d. Returned for credit some of the office equipment previously purchased on credit but not yet
paid for. (Treat this the opposite of a transaction in which you purchased office equipment on
credit.)
e. Sold land for cash at a price in excess of cost. (Hint: The difference between cost and sales
price represents a gain that will be in the company’s income statement.)
f. Purchased a computer on credit.
g. The owner invested cash in the business.
h. Purchased office equipment for cash.
i. Collected an
Indicate the effects of each of these transactions on the total amounts of the company’s assets,
liabilities, and owners’ equity. Organize your answer in tabular form, using the following column
headings and the code letters I for increase, D for decrease, and NE for no effect. The answer for
transaction a is provided as an example:
Transaction Assets Liabilities Owners’ Equity
(a) I I NE
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