Selected Transactions for Parton Company Are Listed Below

question 53

Essay

Selected transactions for Parton Company are listed below. List the number of the transaction and then describe the effect of each transaction on assets, liabilities, and equity.
Sample: Issued ordinary shares in exchange for cash investment.
The answer would be-Increase in assets and increase in equity.
1. Paid monthly utility bill.
2. Purchased new display case for cash.
3. Paid cash for repair work on security system.
4. Billed customers for services performed.
5. Received cash from customers billed in 4.
6. Paid dividends.
7. Incurred advertising expenses on account.
8. Paid monthly rent.
9. Received cash from customers when service was rendered.

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Definitions:

Production Capacity

The maximum output that a company or economy can produce under normal conditions within a given period, often influenced by available resources and technology.

Diminishing Returns

A principle indicating that as more of a variable input is added to a fixed input, the added output from each additional unit of input will eventually decrease.

Resource Labor

The work force considered as an economic resource, emphasizing the skills and abilities workers bring to the economy.

Marginal Output

The additional quantity of output that is produced by using one more unit of a particular input, holding all other inputs constant.