Indicate effect of each transaction on accounting equation

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Reference no: EM131526417

Question: Salvo Delivery Service had the following selected transactions during February:

1. Received cash from issuance of capital stock, $35,000.

2. Received cash for providing delivery services, $15,000.

3. Paid creditors, $1,800.

4. Billed customers for delivery services, $11,250.

5. Paid advertising expense, $750.

6. Purchased supplies for cash, $800.

7. Paid rent for February, $2,000.

8. Received cash from customers on account, $6,740.

9. Determined that the cost of supplies on hand was $135; therefore, $665 of supplies had been used during the month.

10. Paid dividends, $1,000.

Indicate the effect of each transaction on the accounting equation by listing the numbers identifying the transactions, (1) through (10), in a vertical column, and inserting at the right of each number the appropriate letter from the following list:

a. Increase in an asset, decrease in another asset.

b. Increase in an asset, increase in a liability.

c. Increase in an asset, increase in stockholders' equity.

d. Decrease in an asset, decrease in a liability.

e. Decrease in an asset, decrease in stockholders' equity

Reference no: EM131526417

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