Equity before and after the transaction

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Reference no: EM13956279

Explain briefly how each of the following transactions would affect a company’s balance sheet. Remember, assets must equal liabilities plus owners’ equity before and after the transaction.

a) Sale of used equipment with a book value of $300,000 for $500,000 cash.

b) Purchase of a new $80 million building, financed 40 percent with cash and 60 percent with a bank loan.

c) Purchase of a new building for $60 million cash.

d) A $40,000 payment to trade creditors.

e) A firm’s repurchase of 10,000 shares of its own stock at a price of $24 per share.

f) Sale of merchandise for $80,000 in cash.

g) Sale of merchandise for $120,000 on credit.

h) Dividend payment to shareholders of $50,000

Reference no: EM13956279

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