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The Expanded Accounting Equation

The Expanded Accounting Equation. ______ ASSETS = LIABILITIES + Owner’s EQUITY Prepaid Accts. Pay./ B. Trevino,

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The Expanded Accounting Equation

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  1. The Expanded Accounting Equation • ______ ASSETS = LIABILITIES + Owner’s EQUITY • Prepaid Accts. Pay./ B. Trevino, • Cash + Supplies + Insurance = Ling Music Sup. + Capital____ • $0 + $0 + $0 = $0 + $0 Bal. • +10,000 +10,000__(1) • $10,000 + 0 + 0 = 0 + $10,000 Bal. • - 1,577 +1,577 ___(2) • 8,423 + 1,577 + 0 = 0 + 10,000 Bal. • _- 1,200 +1,200__________________________________ (3) • 7,223 + 1,577 + 1,200 = 0 + 10,000 Bal. • _____________+2,720 +2,720____________________ (4) • 7,223 + 4,297 + 1,200 = 2,720 + 10,000 Bal. • - 1,360 - 1,360____________________(5) • $5,863 + $4,297 + $1,200 = $1,360 + $10,000 Bal. • Transactions: • (1) Received cash from owner as an investment, $10,000 • (2) Paid cash for supplies, $1,577 • (3) Paid cash for insurance, $1,200 • (4) Bought supplies on account from Ling Music Supplies, $2,720 • (5) Paid cash on account to Ling Music Supplies, $1,360

  2. The Expanded Accounting Equation ______ ASSETS = LIABILITIES + Owner’s EQUITY Prepaid Accts. Pay./ B. Trevino, Cash + Supplies + Insurance = Ling Music Sup. + Capital_ $0 + $0 + $0 = $0 + $0 Bal. +10,000 +10,000__ (1) $10,000 + 0 + 0 = 0 + $10,000 Bal. - 1,577 +1,577 ____(2) 8,423 + 1,577 + 0 = 0 + 10,000 Bal. - 1,200 +1,200________________________________ (3) 7,223 + 1,577 + 1,200 = 0 + 10,000 Bal. ____________+2,720 +2,720________________ (4) 7,223 + 4,297 + 1,200 = 2,720 + 10,000 Bal. - 1,360 - 1,360________________ (5) $5,863 + $4,297 + $1,200 = $1,360 + $10,000 Bal.

  3. AP1-2 Expanded Accounting Equation • ______ ASSETS = LIABILITIES + Owner’s EQUITY • Prepaid AP/ AP/ Frank Mori, • Cash + Supplies + Insurance = Swan’s + York + Capital____ • $0 + $0 + $0 = $0 + $0 + $0 Bal. • + 2,000 +2,000__(1) • $ 2,000 + 0 + 0 = 0 + 0 + $ 2,000 Bal. • - 600 + 600 ___(2) • 1,400 + 0 + 600 = 0 + 0 + 2,000 Bal. • _ + 100 ____________ +100________________________ (3) • 1,400 + 100 + 600 = 100 + 0 + 2,000 Bal. • _____________+ 500 + 500________________ (4) • 1,400 + 600 + 600 = 100 + 500 + 2,000 Bal. • - 100 -100________________________(5) • 1,300 + 600 + 600 = 0 + 500 + 2,000 Bal. • __- 300 -300________________ (6) • 1,000 + 600 + 600 = 0 + 200 + 2,000 Bal. • __- 500 + 500_____________________________________________ (7) • 500 + 1,100 + 600 = 0 + 200 + 2,000 Bal. • + 500 + 500 (8) • $1,000 + $1,100 + $600 = $0 + $200 + $2,500 Bal. • Transactions: • (1) Received cash from owner as an investment, $2,000 • (2) Paid cash for insurance, $600 • (3) Bought supplies on account from Swan’s Supply Company, $100 • (4) Bought supplies on account from York Company, $500 • (5) Paid cash on account to Swan’s Supply Company, $100 • (6) Paid cash on account to York Company, $300 • (7) Paid cash for supplies, $500 • (8) Received cash from owner as an investment, $500

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