Selected Transactions for the Barkley Company Are Listed Below

question 131

Essay

Selected transactions for the Barkley Company are listed below:
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. Withdrew cash for owner's personal use.
7. Incurred advertising expenses on account.
8. Paid monthly rent.
9. Received cash from customers when service was provided.
Instructions
List the number of the transaction and then describe the effect of each transaction on assets, liabilities, and owner's equity.
Sample: Made initial cash investment in the business. The answer would be: Increase in assets and increase in owner's equity.

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Definitions:

Manufacturing Firms

Companies engaged in the transformation of raw materials into finished products through the use of labor, tools, machinery, and chemical processing.

Merchandising Firms

Businesses that purchase finished goods for resale, typically operating in the retail or wholesale sectors.

Retail and Wholesale

The selling of goods in small quantities (retail) to consumers and in large quantities (wholesale) to businesses or retailers.

Theory of Constraint (TOC)

A management philosophy that focuses on identifying and removing bottlenecks or constraints that limit the performance of a system.