Understanding Accounting

  

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Purpose of Assignment
The purpose of this assignment is to help you become familiar with examining transactions and how
it affects the balance sheet.
Write a minimum 150-word response to each of the following scenarios from Exercise E3-1
in Financial Accounting (p. 132) describing the effect of each transaction on assets, liabilities, and
stockholder’s equity:
•
Selected transactions for Thyme Advertising Company, Inc.
o Issued common stock to investors in exchange for cash received from investors.
o Paid monthly rent.
o Received cash from customers when service was performed.
o Billed customers for services performed.
o Paid dividend to stockholders.
o Incurred advertising expense on account.
o Received cash from customers billed in (4).
o Purchased additional equipment for cash.
o Purchased equipment on account.
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