Chapter 01 Saddleback College Homework

Exercise 1-11 Identifying effects of transactions using the accounting equation LO P1

Lena Holden began a professional practice on June 1 and plans to prepare financial statements at the end of each month. During June, Holden (the owner) completed these transactions:

a.	Owner invested $60,000 cash in the company along with equipment that had a $15,000 market value in exchange for its common stock.
b.	The company paid $1,500 cash for rent of office space for the month.
c.	The company purchased $10,000 of additional equipment on credit (payment due within 30 days).
d.	The company completed work for a client and immediately collected the $2,500 cash earned.
e.	The company completed work for a client and sent a bill for $8,000 to be received within 30 days.
f.	The company purchased additional equipment for $6,000 cash.
g.	The company paid an assistant $3,000 cash as wages for the month.
h.	The company collected $5,000 cash as a partial payment for the amount owed by the client in transaction e.
i.	The company paid $10,000 cash to settle the liability created in transaction c.
j.	The company paid $1,000 cash in dividends to the owner (sole shareholder).

Required:

Enter the impact of each transaction on individual items of the accounting equation. (Enter decreases to account balances with a minus sign.)

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