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Question
Identify the effect of the accounting equation (a through k) of each transaction in 1 through 9 below. You may use each letter more than once or not at all.
| Accounting Effects | |
| a. | A and L |
| b. | + A and + SE (Contributed Capital) |
| c. | + A and + SE (Retained Earnings) |
| d. | + A and A |
| e. | + A and + L |
| f. | A and SE (Contributed Capital) |
| g. | A and SE (Retained Earnings) |
| h. | + L and SE (Retained Earnings) |
| i. | L and + SE (Retained Earnings) |
| j. | + SE (Contributed Capital) and SE (Retained Earnings) |
| k. | No journal entry or effect |
| 1. Issued debt to finance the purchase of property | |
| 2. Issued common stock to finance the purchase of property | |
| 3. Used money resulting from retained earnings to finance the purchase of property | |
| 4. Declared cash dividends to shareholders | |
| 5. Paid the previously declared dividends | |
| 6. Skipped dividends on cumulative preferred stock | |
| 7. Declared and distributed a 10% stock dividend | |
| 8. Declared a 3:1 stock split | |
| 9. The market value of common stock doubled during the year |
Answer
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