Textbook Problem

Cornerstone Exercise 2-20 Transaction Analysis

Four transactions are listed below. CORNERSTONE 2.2

1. Sold goods to customers on credit.
2. Collected amounts due from customers.
3. Purchased supplies on account.
4. Used supplies in operations of the business.

Required:

Prepare three columns labeled assets, liabilities, and stockholders’ equity. For each of the transactions, indicate whether the transaction increased (+). decreased (-). or had no effect (NE) on

Assets, liabilities, or stockholders’ equity.