Identify the Impact on the Accounting Equation of Each of the Following

question 176

Essay

Identify the impact on the accounting equation of each of the following transactions.
1. Purchase office supplies on account.
2. Paid secretary weekly salary.
3. Purchased office furniture for cash.
4. Received monthly utility bill to be paid at later time.

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Definitions:

Net Operating Loss Carryforward

This is a tax provision that allows a company to apply a tax year's net operating losses to future years' profits in order to lower tax liabilities.

US GAAP

The Generally Accepted Accounting Principles in the United States, a framework of accounting standards, principles, and procedures used in the financial reporting of companies.

IFRS

International Financial Reporting Standards, a set of accounting principles that provide guidelines for financial reporting and are recognized globally.

Deferred Taxes

Deferred taxes are future tax liabilities or assets, reflecting the temporary differences between the accounting income and taxable income.