explain briefly how each of the following transaction would affect a company's balance sheet. (Remember, assets must equal liabilities plus owners' equity before and after the transaction.)

A. Sale of used equipment with a book value of $300,000 for $500,000 cash.
B. Purchase of a new $80 million building, financed 40 percent with cash and 60 percent with a bank loan.
C. Purchase of a new building for $60 million cash
D. A $40,000 payment to trade creditors
E. A firm's repurchase of 10,000 shares of its own stock at a price of $24 per share
F. Sale of merchandise for $80,000 in cash
G. Sale of merchandise for $120,000 on credit
H. Dividend payment to shareholders of $50,000.

What have you done so far ?
We're happy to HELP but we won't do all the work for you..

Quote:

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Originally Posted by Curlyben

What have you done so far ?
We're happy to HELP but we wont do all the work for you..

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I did not ask you to do my work I needed help in understanding whether I was on the right track or not. But you did not help me at all. But Thank you anyway.

As you haven't posted YOUR work, how can we know where you are having problems?
Care to try again ?

For this problem you have to know what accounts will be affected as well as how they are affected. Hint: The journal entry.

So for an example: Number A.
The journal entry would be:
Debit Cash
Debit Accumulated Depreciation
Credit Equipment
Credit Gain on Sale of Equipment.

Now you have the journal entry you should be able to solve the problem.
Liabilities are not affected. There is a decrease in one asset (equipment) and one contra asset (accumulated depreciation) and an increase in one asset (cash). The net result is an increase in assets. Also you have an increase in Owners Equity because a gain on sale will increase net income, which in turn will increase retained earnings.

Now you should be able to answer the rest of your problem.