Question

QUESTION 9 Record the transaction below. Shareholders' Equity Assets Liabilities The following events took place in the first month of business. Adjusted for the interest owed on the bank loan TO RECEIVE CREDIT FOR THE QUESTION, AN ANSWER MUST BE SELECTED FOR EACH EVEN IF THERE IS NO EFFECT IF THERE IS NO Common StockRetained Earnings EFFECT, SELECT "O NO EFFECT." A 40 Cash B.(40) Note Payable (40) Interest Expense (40) Interest Payable E. O No Effect F40 Interest Payable Assets - Liabilities Common Stock Retained Earnings

Answer 1

Solution:

Assets = E. 0 No Effect

Liabilities = F. 40 Interest Payable

Common Stock = E. 0 No Effect

Retained Earnings = C. (40) Interest Expense

	Assets	Liabilities	Stockholders' Equity
			Common Stock	Retained earnings
Adjusted for the interest owed on the Bank Loan	$0	$40	$0	-$40
	E. No effect	F. Interest Payable	E. No effect	C. Interest Expense