BAF3M (2012): Financial Accounting Principles (2012), Grade 11

Unit 2 Activity 2 – Assessing Business Transactions

For each of the transactions listed below,

● determine the balance sheet accounts affected;
● indicate whether they are increased or decreased, and;
● state the value of the change.
Increase Decrease Amount
Equipment $2 000
Example: Purchased equipment for $2 000 cash. 
Cash $2 000
 
Bank
a) Received $1 800 payment from customers for $1 800
Account
previous purchases on credit.
Accounts
$1 800
Receivable
Cash $5 000
b) Owner invested $5 000 in the business.

c) Paid salaries totaling $2 000 to employees. Bank accounts $2 000

Accounts
$2 000
payable

d) Purchased $15 000 automobile on credit. Account $15 000

Payable

Equipment $15 000

e) Purchased new office building; paid $200 000 cash Assets $500 000
and took out mortgage for $300 000.
Bank account $200 000

Accounts $300 000

payable

f) Received $850 for the sale of an old piece of Bank $850

equipment. Accounts
Equipment $850

g) Paid $890 for repairs to building. Cash in Bank $890

Hint: When repairs occur, this does not increase the

value of the building but rather reduces owner’s Captial $890
equity.

h) Paid $8 000 toward amount owing for automobile Bank Account $8 000
purchased previously. Accounts
$8 000
payable

i) Performed accounting services for $4 500 and was Bank $4 500

paid cash. account

j) Sent a bill for $4 200 to a customer for accounting Accounts $4 200

services; to be paid later. receivable