Chapter D, Problem 5E

To determine

Accounting Equation: Accounting equation is also known as balance sheet equation. Accounting equation is based on the principles of double entry system of accounting. The accounting equation is as follows

$Assets=Liability+owner’sequity$

Journal: A journal is the complete record of a financial transaction which shows the debit and credit of respective accounts for every transaction including the explanation of the transaction.

T-Accounts: An account is a unique record of increases or decreases in any asset, liability, equity, revenues or expenses. T-accounts are drawn to resemble a T-shape with debit on the left and credit on the right. Assets and expenses have normally debit balances and liability, equity and revenue accounts have normally credit balance.

To analyze:

The given transaction using accounting equation.

To determine

Accounting Equation: Accounting equation is also known as balance sheet equation. Accounting equation is based on the principles of double entry system of accounting. The accounting equation is as follows

$Assets=Liability+owner’sequity$

Journal: A journal is the complete record of a financial transaction which shows the debit and credit of respective accounts for every transaction including the explanation of the transaction.

T-Accounts: An account is a unique record of increases or decreases in any asset, liability, equity, revenues or expenses. T-accounts are drawn to resemble a T-shape with debit on the left and credit on the right. Assets and expenses have normally debit balances and liability, equity and revenue accounts have normally credit balance.

To prepare:

Journal Entries for the given transaction.

To determine

Accounting Equation: Accounting equation is also known as balance sheet equation. Accounting equation is based on the principles of double entry system of accounting. The accounting equation is as follows

$Assets=Liability+owner’sequity$

Journal: A journal is the complete record of a financial transaction which shows the debit and credit of respective accounts for every transaction including the explanation of the transaction.

T-Accounts: An account is a unique record of increases or decreases in any asset, liability, equity, revenues or expenses. T-accounts are drawn to resemble a T-shape with debit on the left and credit on the right. Assets and expenses have normally debit balances and liability, equity and revenue accounts have normally credit balance.

To prepare:

T-accounts for the given transactions.