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Analyze each of the following transactions and determine the effect on the accounting equation.
1.Purchased three months' worth of prepaid advertising for $300.
2.Paid $500 cash on an account payable.
3.Paid $100 for supplies.
4.Performed $4,000 of services on account.
Voidable
A term used to describe a legal agreement or transaction that can be validated or invalidated at the discretion of one of the parties involved.
Overcharged
A situation where an individual is billed more than the agreed price or fair value for goods or services.
Reasonable Value
The fair or market value of a service or item, taking into consideration its quality, utility, and the prevailing conditions.
Mentally Incompetent
A legal status indicating a person's inability to make decisions or handle affairs because of mental health issues or intellectual disabilities.
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