Question

Maya started her business on July 1, 2020. The following transactions occurred during the month of July.

Identify the effects of the following transactions on the accounting equation:

July	Transactions
1	Maya started her agriculture business with RM150,000 cash.
3	Paid RM1,000 in the month for rent of office space.
4	Purchased RM1,500 chemicals on credit terms from BioLogic Company.
5	Paid RM700 for publicity in the Malaysia Business newspaper.
8	Interviewed candidates who applied for a marketing executive position with a monthly salary of RM1,800.
10	Customers paid RM3,500 cash for goods purchased.
11	The office space was redecorated with the payment of RM4,000 cash.
14	Chemicals worth RM25,000 were sold on account.
16	Paid RM1,800 in cash for insurance services.
18	Employees’ salaries of RM8,000 was paid for by cash.
21	Paid the supplies purchased on account on 4th July.
24	Received a cash payment of RM20,000 for chemicals sold on account on 14th July.
27	The sum of RM600,000 was borrowed from a local bank on a long-term basis.
28	Purchased office equipment for RM30,000 on the account.
30	Utilities of RM1,500 were settled.

Answer 1

July	Transactions	Assets=	Liabilities +	Owner's Equity
1	Maya started her agriculture business with RM150,000 cash.	+150000		+150000
		+Cash		+Capital
3	Paid RM1,000 in the month for rent of office space.	-1000		-1000
		-Cash		+Expenses
4	Purchased RM1,500 chemicals on credit terms from BioLogic Company.	+1500	+1500
		+Stock	+Creditor
5	Paid RM700 for publicity in the Malaysia Business newspaper.	-700		-700
		-Cash		+Expenses
8	Interviewed candidates who applied for a marketing executive position with a monthly salary of RM1,800.	-1800		-1800	Treatment will be valid if the candidates are selected and get paid in the month of july.
		-Cash		+Expenses
10	Customers paid RM3,500 cash for goods purchased.	+3500		+3500
		+Cash		+Revenue
11	The office space was redecorated with the payment of RM4,000 cash.	-4000		-4000
		-Cash		+Expenses
14	Chemicals worth RM25,000 were sold on account.	+25000		+25000
		+Debtors		+Revenue
16	Paid RM1,800 in cash for insurance services.	-1800		-1800
		-Cash		+Expenses
18	Employees’ salaries of RM8,000 was paid for by cash.	-8000		-8000
		-Cash		+Expenses
21	Paid the supplies purchased on account on 4th July.	-	-
		-Cash	-Creditor
24	Received a cash payment of RM20,000 for chemicals sold on account on 14th July.	+20000, '-20000
		+Cash, -Debtors
27	The sum of RM600,000 was borrowed from a local bank on a long-term basis.	+600000	+600000
		+Bank	+Long Term Bank Loan
28	Purchased office equipment for RM30,000 on the account.	+30000	+30000
		+Equipment	+Creditor
30	Utilities of RM1,500 were settled.	-1500	-1500
		-Cash	-Creditor