Chapter 1, Problem 1.11EX

To determine

Accounting equation: Accounting equation is an accounting tool expressed in the form of equation, by creating a relationship between the resources or assets of a company, and claims on the resources by the creditors and the owners. Accounting equation is expressed as shown below:

$\begin{array}{c}\text{Assets = Liabilities + Owners' Equity}\\ \text{Assets = Liabilities+}\left\{\left(\begin{array}{l}\text{Owners' }\\ \text{investments}\end{array}\right)\text{+}\left(\begin{array}{l}\text{Owners' }\\ \text{withdrawals}\end{array}\right)\text{+}\left(\begin{array}{l}\left(\text{Revenues}\right)\text{–}\\ \left(\text{Expenses}\right)\end{array}\right)\right\}\end{array}$

To analyze: Business transactions by indicating their effects on accounting equation.