determining financial statement effects of several transactions 242729

Determining Financial Statement Effects of Several Transactions

The following events occurred for Christensen Company:

a. Received investment of $34,000 cash by organizers and distributed stock to them.

b. Purchased $8,000 of equipment, paying $1,000 in cash and signing a note for the rest.

c. Borrowed $9,000 cash from a bank.

d. Loaned $500 to an employee who signed a note.

e. Purchased $15,000 of land; paid $4,000 in cash and signed a mortgage note for the balance.

Required:

For each of the events (a) through (e), perform transaction analysis and indicate the account, amount, and direction of the effect (+ for increase and ?^? for decrease) on the accounting equation. Check that the accounting equation remains in balance after each transaction. Use the following headings:

Event Assets = Liabilities + Stockholders’ Equity

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