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Reinforcement Problems
LG 20-1.
Cash
+  
Dean Jones, Capital
  +
Supplies
+  
Notes Payable
  +
Wages Payable
  +
Equipment
+  
Accounts Receivable
+  
Accounts Payable
  +
Notes Receivable
+  
Land
+  
LG 20-2. The natural positive side of an account is an essential point of reference. When the
natural positive side is agreed upon, then both the increases and decreases can be recorded in a
consistent and accurate way. The natural positive side is used to: (1) record account increases; and
(2) show account balances. The opposite side then becomes the side used for decreases.
LG 20-3.
  a.
Cash
750  
 
Accounts Receivable
  750
 
     Increase/decrease: Cash increases and Accounts Receivable decreases.
     Description: The business collected $750 cash from customers who owed the business on
   account.
  b.
Supplies
1,000  
 
Accounts Payable
  1,000
 
     Increase/decrease: Supplies increases and Accounts Payable increases.
     Description: The business purchased $1,000 of supplies on account (on credit).
  c.
Cash
  500
 
Supplies
500  
 
     Increase/decrease: Cash decreases and Supplies increases.
     Description: The business purchased $500 of supplies for cash.
  d.
Equipment
15,000  
 
Cash
  5,000
Notes Payable
  10,000
     Increase/decrease: Equipment increases, Cash decreases, and Notes Payable increases.
     Description: The business purchased $15,000 of equipment, paying $5,000 cash and
   signing a note payable for $10,000.
Learning Goal 20
SOLUTIONS
     
Learning Goal 20: Explain the Use of Accounts
S1
  
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