accounting equation effect 421483

EZ Curb Company completed the following transactions during 2010. The annual accounting period ends December 31, 2010.

Purchased merchandise on account at a cost of $14,000. (Assume a perpetual inventory system.)

Received $40,000 from National Bank after signing a 12 month, 6 percent, promissory note.

Rented out a small office in a building owned by EZ Curb Company and collected six months’ rent in advance amounting to $6,000. (Use an account called Unearned Rent Revenue.)

Received a $100 deposit from a customer as a guarantee to return a large trailer “borrowed” for 30 days.

(TIP: Consider whether EZ Curb Company has an obligation to return the money when the trailer is returned.)

Determined that wages of $6,500 were earned but not yet paid on December 31 (ignore payroll taxes).

For each listed transaction and related adjusting entry, indicate the accounts, amounts, and effects ( + for increase, ‘ for decrease, and NE for no effect) on the accounting equation