Question

Return to questionItem 5Item 5 1.66 points For each of the following transactions of Spotlighter, Inc., for the month of January, indicate the accounts, amounts, and direction of the effects on the accounting equation. A sample is provided. (Enter any decreases to account balances with a minus sign.) a.(Sample) Borrowed $5,740 from a local bank on a note due in six months. b.Received $6,430 cash from investors and issued common stock to them. c.Purchased $2,800 in equipment, paying $1,100 cash and promising the rest on a note due in one year. d.Paid $1,200 cash for supplies. e.Bought and received $1,600 of supplies on account.

Answer 1

The accounting equation is shown below.

Step-by-step explanation:

Particular Assets = Liabilities + Stockholder equity

a. Cash $5,740 Note payable $5,740

b. Cash $6,430 Common stock $6,430

c. Cash - $1,100

Equipment $2,800 Note payable $1,700

d. Supplies $1,200

Cash - $1,200

e. Supplies $1,600 Account payable $1,600

Total $15,470 $9,040 $6,430

The positive or no signs reflects the increase in accounts while the negative signs reflects the decrease in accounts