Identify how each of the following separate transactions affects financial statements. For the balance sheet, identify how each transaction affects total assets, total liabilities, and total equity. For the income statement, identify how each transaction affects net income. For the statement of cash flows, identify how each transaction affects cash flows from operating activities, cash flows from financing activities, and cash flows from investing activities. For increases, place a “1” in the column or columns. For decreases, place a “2” in the column or columns. If both an increase and a decrease occur, place “1y2” in the column or columns. The first transaction is completed as an example.

Balance sheet Income Statement Statement of Cash Flows

Transaction

Total Assets

Total Liab.

Total Equity

Net Income

Operating Activities

Financing Activities

Investing Activities

1

Owner Invests cash In business

+

+

+

2

Buys building by signing note payable

3

Pays cash for salarles incurred

4

Provides services for cash

5

Pay cash for rent incurred

6

Incurs utilities costs on credit

7

Buys store equipment for cash

8

Owner withdraws cash

9

Provides services on credit

10

Collects cash on receivable from (9)