Using the accounting equation to analyze transactions and calculate net income or net loss
The analysis of the first eight transactions of All-in-one Accounting Service follows. The owner made only one investment and there were no owner drawings.
|
Cash |
+ Accounts receivable |
+ Equipment |
= Accounts payable |
+ Larrison capital |
|
|
1 |
+ 31,000 |
+ 31,000 |
|||
|
2 |
+ 3,800 |
+ 3,800 |
|||
|
3 |
+ 13,400 |
+ 13,400 |
|||
|
4 |
+ 190 |
– 190 |
|||
|
5 |
– 410 |
+ 410 |
|||
|
6 |
– 8,000 |
– 8,000 |
|||
|
7 |
+ 790 |
+ 790 |
|||
|
8 |
– 1,500 |
– 1,500 |
Requirements
1. Describe each transaction.
2. If these transactions fully describe the operations of All-in-one Accounting Service during the month, what was the amount of net income or net loss?