Assume that Global Cleaning Service performed cleaning services for a department store on account for $180. How would this transaction affect Global Cleaning Service's accounting equation?A. Increase both assets and liabilities by $180B. Increase both assets and equity by $180C. Increase both liabilities and equity by $180D. Decrease liabilities by $180, and increase equity by $180

Name: Assume that Global Cleaning Service performed cleaning services for a
Uploaded: 2024-03-04T10:43:15.000Z
Channel: Bartleby
Description: Assume that Global Cleaning Service performed cleaning services for a department store on account for $180. How would this transaction affect Global Cleaning Service's accounting equation?A. Increase both assets and liabilities by $180B. Increase bo

An accounting equation refers to an equation that shows the effect of accounting transactions on all…

Business

Accounting

Assume that Global Cleaning Service performed cleaning services for a department store on account for $180. How would this transaction affect Global Cleaning Service's accounting equation? OA. Increase both assets and liabilities by $180 OB. Increase both assets and equity by $180 OC. Increase both liabilities and equity by $180 O D. Decrease liabilities by $180, and increase equity by $180

Assume that Global Cleaning Service performed cleaning services for a department store on account for $180. How would this transaction affect Global Cleaning Service's accounting equation? OA. Increase both assets and liabilities by $180 OB. Increase both assets and equity by $180 OC. Increase both liabilities and equity by $180 O D. Decrease liabilities by $180, and increase equity by $180

Financial Accounting: The Impact on Decision Makers

10th Edition

ISBN:9781305654174

Author:Gary A. Porter, Curtis L. Norton

Publisher:Gary A. Porter, Curtis L. Norton

Chapter1: Accounting As A Form Of Communication

Section: Chapter Questions

Problem 1.4E: The Accounting Equation Ginger Enterprises began the year with total assets of $500,000 and total...

See similar textbooks

Related questions

Q: Gulf Cement, Inc. reports the following assets and liabilities. Compute the totals that would appear…

A: Assets = liabilities + Equity shareholders fund The fundamental accounting equation, also called…

Q: Choose the Debit and Credit Accounts of the following transactions. TRANSACTION: Opened an account…

A: Debit and credit are two aspects of a business. In double accounting system, it is necessary to…

Q: Indicate if the following transaction from Torte Baking Company increases or decreases assets,…

A: Accounting Equation :— Accounting Equation is Also Known As Basic Accounting Equation or Balance…

Q: What is the amount of net income if ABC firm has the following balances in their accounts Sales…

A: Total revenue=Sale +Service revenue=JD 12,000+2,000=JD 14,000

Q: Choose the Debit and Credit Accounts of the following transactions.

A: In Financial Accounting, Debit indicates the Increase in Asset or decrease in liability whereas…

Q: What is the primary purpose of the Statement of Affairs ? a. To determine how much is owed by…

A: Hi student Since there are multiple questions, we will answer only first question Statement of…

Q: Use the accounting equation to compute the missing financial statement amounts in the two separate…

A: According to accounting equation assets equals the total of liabilities and equity. The accounting…

Q: SUBJECT: Financial Accounting and Reporting Instruction: Choose the Debit and Credit Accounts of…

A: The journal entries are prepared to keep the record of day to day transactions of the business.

Q: For the following situations, identify whether the situation represents a violation or a correct…

A: There are principles and assumptions based on which whole accounting depends regarding how to enter…

Q: Use the following to answer questions 16 - 19 For each transaction indicate whether it should: A.…

A: Assets = Liabilities + Stockholders Equity Stockholders' Equity = Common stock + Retained earnings…

Q: If a company purchases equipment costing $4,500 on credit, the effect on the accounting equation…

A: The question is related to the purchase of equipment on credit. The Accounting Equation is Assets =…

Q: XYZ Company's accounting records reported the following account balances as of December 31, 2024:…

A: Lets understand the basics. For calculating the missing figures, we need to first calculate net…

Q: 6. Assume that r@ktas Inc., sold inventory on account for $ 2,000. How would this transaction affect…

A: With sale and purchase of inventory, different accounts get affected. This also effects the…

Q: Prepare a horizontal analysis of both the balance sheet and income statement. Complete this question…

A: HORIZONTAL ANALYSIS OF BALNCE SHEET Horizontal analysis is used to review of a Companies…

Q: If a company purchases equipment costing $6,100 on credit, the effect on the accounting equation…

A: The accounting equation states that a company's assets equal its liabilities plus equity,…

Q: Use the following information to perform the calculations below (using the indirect method). Net…

A: A cash flow statement indicates cash inflow and outflow information for a particular time period and…

Q: Synergy Enterprise has the following financial statement items: Details Classification of account 1.…

A: Classification of Accounts - Income Statement includes revenue and Expense. On the basis of that…

Q: Refer to the 10-K for Abercrombie & Fitch. Required: 1. What does the company report for the…

A: 1. **Determine the Current Year's Values**: - Before making projections for the next fiscal year,…

Q: I. Multiple Choice Directions: Choose the letter corresponding to the correct answer for each of the…

A: “Since you have asked multiple sub-parts, we will solve the first three sub-parts for you. If you…

Q: The current assets of FDN Company's Statement of Financial Position would have the following: Trade…

A: Current assets: Current assets are all those assets that are expected to be sold or used as a result…

Q: Rosie Dry Cleaning was started on January 1, Year 1. It experienced the following events during its…

A: The account receivable refers to the amount of revenue that is yet to be recovered from the…

Q: Choose the letter corresponding to the correct answer for each of the questions provided below. 1.…

A: “Since you have asked multiple question, we will solve the first question for you. If you want any…

Q: Calculate the amount of gross profit reported in ABC Company's 2026 income statement.

A: Profit earned by the Business Entity before deducting indirect expenses, is known as Gross Profit.…

Q: Question: Determine the missing amount from each of the expanded accounting equation below: Assets…

A: An accounting equation is a tool in the accounting process that is used to prove the establishment…

Q: Analyze the effects of a Company's transactions on the accounting equation. Included are the…

A: Accounting Equations:- Accounting equation is also known as the balance sheet equation that shows…

Q: 6. Assume that r@ktas Inc., sold inventory on account for $ 2,000. How would this transaction affect…

A: Accounting equation says that total assets should always be equals to total liabilities and…

Q: 45) Based on the following information from a business's financial statements, what amount of…

A: Account receivables means the amount due from customer to whom the goods sold on credit. With the…

Q: D) Using the fundamental accounting equation (A = L + E), calculate the unknown item in each of the…

A: a. We know that, Assets = Liabilities + Owner's Equity So, $300,000 = $200,000 + Owner's Equity…

Q: Sales made to Ahmed on credit should be debited to? Select one: a. Cash A/C b. Account Receivable…

A: Sales revenue: It is the revenue earned by a business on selling the goods or providing services to…

Q: During the most recent accounting period, a business sold inventories for £1,500 on credit that it…

A: Note: Due to Sales on account Trade receivables will be increased by the amount of sales and…

Concept explainers

Financial Transaction Analysis

The transaction analysis is done with the help of the accounting equation. The basic accounting equation is alternatively known as the balance sheet equation is based on the double-entry system which says that for each transaction happening in a business, at least two accounts should be affected I.e. both the debit side and the credit side should be equal. The Accounting Equation is

Topic Video

Question

Assume that Global Cleaning Service performed cleaning services for a department store on account for $180. How would this transaction affect Global Cleaning Service's accounting equation?
A. Increase both assets and liabilities by $180
B. Increase both assets and equity by $180
C. Increase both liabilities and equity by $180
D. Decrease liabilities by $180, and increase equity by $180

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1: Meaning of accounting equation

VIEW

Step 2: Explanation of correct option

VIEW

Step 3: Explanation of incorrect options

VIEW

Solution

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 4 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

The business collects an OR5,000 account receivable from its customer. How is the accounting equation affected? Select one: O a. Assets increase OR 5,000; owner's equity increases OR 5,000. O b. Assets increase OR 5,000; liabilities decrease OR 5,000. c. Assets increase OR5,000; liabilities increase OR 5,000. O d. One asset increases by OR5,000; another asset decreases OR $5,000.
Consider the following transactions associated with accounts receivable and the allowance for uncollectible accounts.Required:For each transaction, indicate whether it would increase (I), decrease (D), or have no effect (NE) on the account totals. (Hint: Make sure the accounting equation, Assets = Liabilities + Stockholders’ Equity, remains in balance after each transaction.)
Manor Ltd. records their business transactions into the basic accounting equation. For each of the following independent business activities, indicate the effect on the basic accounting equation. Signed a contract with a new customer to provide $6,000 of services in the future. A. Increase assets, decrease assets B. Increase assets, decrease liabilities C. Increase assets, increase liabilities D. Increase assets, increase equity E. Increase assets, decrease equity F. Increase liabilities, increase equity G. Increase liabilities, decrease equity H. Decrease liabilities, increase equity I. Decrease liabilities, decrease equity J. Decrease assets, decrease liabilities K. Decrease assets, increase liabilities L. Decrease assets, increase equity M. Decrease assets, decrease equity N. No entry is required. Enter the correct LETTER choice (A B C D E F G H I J K L M N ) Purchase $800 of office supplies on account. A. Increase assets, decrease assets B.…
If a company purchases equipment costing $6,100 on credit, the effect on the accounting equation would be: Multiple Choice Assets increase $6,100 and liabilities increase $6,100. Equity decreases $6,100 and liabilities increase $6,100. One asset increases $6,100 and another asset decreases $6,100. Assets increase $6,100 and liabilities decrease $6,100. Equity increases $6,100 and liabilities decrease $6,100.
What is the operating income and the net income?
Use the following to answer questions 16 - 19 For each transaction indicate whether it should: A. increase, B. decrease, or C. no effect. Credit sales transaction cycle Assets Liabilities Stockholders' equity Revenues Expenses 16. Provide services on account 17. Estimate uncollectible accounts 18. Write off accounts as uncollectible 19. Collect on account previously written off
D) Using the fundamental accounting equation (A = L + E), calculate the unknown item in each of the following questions. a. If Assets are $300,000 and Liabilities are $200,000 how much is the Owner's Equity? Answer: Owners equity = b. If Sales are $100000, COGS $30000, Operating Expenses $15000 what is the Income from Operations? Answer: Income from Operations = c. If Beginning Inventory are $10000, New Purchased Inventory $5000, Ending Inventory $2000 what is the Cost of Goods Sold? Answer: Cost of Goods Sold =
Synergy Enterprise has the following financial statement items: Details Classification of account 1. Trade payable 2. Brand 3. Cash in hand 4. Cost of sales 5. Transportation charges 6. Property 7. Bond 8. Unearned ticket revenue 9. Notes payable 10. Bad debt recovered 11. Commission received 12. Telephone bill 13. Printing cost 14. 15. Accrued salary 16. Prepaid insurance Required: Indicate whether each of the accounts above is a Current Asset (CA), Non-Current asset (NCA), Current Liability (CL), Non-Current liability (NCL), Revenue (R), and Expense (E). Use the following format to prepare your answer. Details Classification of account Example: Salary and wages Expenses Trade payable 1. 2. Brand 3. Cash in hand Decrease in doubtful debt
Which of the following statements is TRUE? If a company provides service and bills its client $20,000, the journal entry to record this transaction will cause Total Assets to increase. a. b. If a company collects a cash deposit of $20,000 for services not yet performed, the journal entry to record this transaction will cause Net Income to increase. If a company pays $20,000 for inventory previously purchased on account, the journal entry to record this payment will cause Total Liabilities to increase. с. d. None of the above.
Indicate if the following transaction from Torte Baking Company increases or decreases assets, liabilities, equity, revenue, expense, and net income. The pattern of the + and - must adhere to the balance sheet equation. Show the impact of revenue and expense on both net income and equity. If there is a + and - within one category (e.g., assets for transaction 2), then list the accounts that go up and down. Transaction (25) Record Salary Expense that will be paid later Assets ["", "", ""] Liabilities ["", "", ""] Equity ["", "", ""] Revenue ["", "", ""] Expense ["", "", ""] Net Income ["", "", ""]
1. Please see the attached photo. 2. The chart of accounts is a listing of the accounts presently having balances in the general ledger. True or false? 3. Revenue is the amount of money your business brings in by selling it's products or services to clients.
Alpha Company has assets of $634,000, llabilities of $267,000, and equity of $367,000. It buys office equipment on credit for $92,000. What would be the effects of this transaction on the accounting equation? O Multiple Choice Assets increase by $92,000 and expenses decrease by $92,000. Liabilities increase by $92,000 and expenses decrease by $92,000. Assets increase by $92,000 and expenses increase by $92,000. Assets increase by $92,000 and liabilities increase by $92,000. Assets decrease by $92,000 and expenses decrease by $92,000.