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Bombeck Inc. has the following transactions during August of the current year.
Indicate (a) the effect on the accounting equation and (b) the debit-credit analysis.
Aug. 1 Opens an office as a financial advisor, investing $6,000 in cash in exchange for common stock
4 Pays insurance in advance for 6 months, $1,950 cash.
16 Receives $2,300 from clients for services performed.
27 Pays secretary $1,590 salary.
(a) Effect on Accounting Equation
(b) Debit-Credit Analysis
Aug. 1The asset
is
Increased
Decreased
;Debits
Decrease Stockholders’ Equity
Increase Revenues
Increase Stockholders’ Equity
Decrease Assets
Decrease Revenues
Decrease Expenses
Increase Assets
Increase Expenses
the account
is
Increased
Decreased
.Debit
$
Credits
Increase Expenses
Decrease Stockholders’ Equity
Decrease Expenses
Increase Assets
Increase Stockholders’ Equity
Decrease Assets
Increase Revenues
Decrease Revenues
Credit
$
Aug. 4The asset
is
Increased
Decreased
;Debits
Increase Expenses
Increase Revenues
Decrease Stockholders’ Equity
Decrease Revenues
Decrease Expenses
Increase Assets
Increase Stockholders’ Equity
Decrease Assets
the asset
is
Increased
Decreased
.Debit
$
Credits
Increase Assets
Increase Expenses
Decrease Revenues
Decrease Expenses
Increase Stockholders’ Equity
Decrease Assets
Increase Revenues
Decrease Stockholders’ Equity
Credit
$
Aug. 16 The asset
is
Increased
Decreased
;Debits
Decrease Revenues
Decrease Expenses
Increase Expenses
Decrease Stockholders’ Equity
Increase Revenues
Increase Assets
Increase Stockholders’ Equity
Decrease Assets
the revenue
is
Increased
Decreased
.Debit
$
Credits
Decrease Expenses
Decrease Stockholders’ Equity
Increase Assets
Increase Stockholders’ Equity
Decrease Assets
Increase Revenues
Increase Expenses
Decrease Revenues
Credit
$
Aug. 27The expense
is
Increased
Decreased
;Debits
Decrease Assets
Decrease Stockholders’ Equity
Increase Stockholders’ Equity
Decrease Revenues
Increase Revenues
Increase Expenses
Decrease Expenses
Increase Assets
the asset
is
Increased
Decreased
.Debit
$
Credits
Decrease Expenses
Increase Assets
Increase Revenues
Increase Expenses
Decrease Stockholders’ Equity
Increase Stockholders’ Equity
Decrease Assets
Decrease Revenues
Credit
$
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