Determining the Financial Statement Effects of Accounts Payable Transactions Hobson Company had the following transactions relating to its accounts payable. Use the financial statement effects template to identify the effects (both amounts and accounts) for these transactions. a. Purchases $2,772 of inventory on credit. b. Sells inventory for $3,630 on credit. c. Records $2,772 cost of sales for transaction b. d. Receives $3,630 cash toward accounts receivable. e. Pays $2,772 cash to settle accounts payable. Note: For each account category, indicate the appropriate account name. Enter "N/A" for any account category that is not used for a given transaction. Note: Indicate a decrease in an account category by including a negative sign with the amount. Balance Sheet Income Statement Transaction Cash Asset + Noncash Assets = Liabilities + Contrib. Capital + Earned Capital Revenues – Expenses = Net Income a. Answer Answer = Answer Answer Answer Answer – Answer = Answer Answer Answer Answer Answer Answer Answer Answer b. Answer Answer = Answer Answer Answer Answer – Answer = Answer Answer Answer Answer Answer Answer Answer Answer c. Answer Answer = Answer Answer Answer Answer – Answer = Answer Answer Answer Answer Answer Answer Answer Answer d. Answer Answer = Answer Answer Answer Answer – Answer = Answer Answer Answer Answer Answer Answer Answer Answer e. Answer Answer = Answer Answer Answer Answer – Answer = Answer Answer Answer Answer Answer Answer Answer Answer PreviousSave AnswersNext

Financial Accounting

14th Edition

ISBN:9781305088436

Author:Carl Warren, Jim Reeve, Jonathan Duchac

Publisher:Carl Warren, Jim Reeve, Jonathan Duchac

Chapter5: Accounting Systems

Section: Chapter Questions

Problem 2PA: Transactions related to revenue and cash receipts completed by Albany Architects Co. during the...

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Determining the Financial Statement Effects of Accounts Payable Transactions

Hobson Company had the following transactions relating to its accounts payable. Use the financial statement effects template to identify the effects (both amounts and accounts) for these transactions.

a. Purchases $2,772 of inventory on credit.
b. Sells inventory for $3,630 on credit.
c. Records $2,772 cost of sales for transaction b.
d. Receives $3,630 cash toward accounts receivable.
e. Pays $2,772 cash to settle accounts payable.

Note: For each account category, indicate the appropriate account name. Enter "N/A" for any account category that is not used for a given transaction.
Note: Indicate a decrease in an account category by including a negative sign with the amount.

	Balance Sheet	Income Statement
Transaction	Cash Asset	+	Noncash Assets	=	Liabilities	+	Contrib. Capital	+	Earned Capital	Revenues	–	Expenses	=	Net Income
a.	Answer		Answer	=	Answer		Answer		Answer	Answer	–	Answer	=	Answer
	Answer		Answer		Answer		Answer		Answer	Answer		Answer
b.	Answer		Answer	=	Answer		Answer		Answer	Answer	–	Answer	=	Answer
	Answer		Answer		Answer		Answer		Answer	Answer		Answer
c.	Answer		Answer	=	Answer		Answer		Answer	Answer	–	Answer	=	Answer
	Answer		Answer		Answer		Answer		Answer	Answer		Answer
d.	Answer		Answer	=	Answer		Answer		Answer	Answer	–	Answer	=	Answer
	Answer		Answer		Answer		Answer		Answer	Answer		Answer
e.	Answer		Answer	=	Answer		Answer		Answer	Answer	–	Answer	=	Answer
	Answer		Answer		Answer		Answer		Answer	Answer		Answer

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