Several transactions are listed below,with the accounting equation stated to the right side of each.Use the following identification codes to indicate the effects of each transaction on the accounting equation: I = Increase; D = Decrease; NE = No Effect.Write your answers in the space provided under the accounting equation,being sure to include an identification code for each element of the accounting equation.An example is provided before the first transaction.
Definitions:
Current Ratio
A liquidity ratio that measures a company's ability to cover its short-term obligations with its current assets.
Gross Margin Percentage
A financial metric that measures the difference between revenue and the cost of goods sold, divided by revenue, expressed as a percentage; it shows the proportion of money available to cover other expenses and profit.
Return On Total Assets
A financial ratio that measures the profitability of a company relative to its total assets, indicating how effectively a company is using its assets to generate earnings.
Long-Term Debt
Borrowings and financial obligations that are due for repayment in a period exceeding one year.
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