business transactions.

Presented below are three business transactions. On a sheet of paper, list the letters (a), (b),
and (c) with columns for assets, liabilities, and owner’s equity. For each column, indicate whether the
transactions increased (+), decreased (–), or had no effect (NE) on assets, liabilities, and owner’s equity.
a. Purchased supplies on account.
b. Received cash for performing a service.
c. Paid expenses in cash.

Follow the same format as in BE1.7. Determine the effect on assets, liabilities, and owner’s
equity of the following three transactions.
a. Invested cash in the business.
b. Withdrawal of cash by owner.
c. Received cash from a customer who had previously been billed for services performed.