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The accounting equation for Yeungling Company shows a decrease in its assets and a decrease in its equity. Which of the following transactions could have caused that effect?

On December 1, Bradley Company borrowed $300,000, at 8% annual interest, from the Tennessee National Bank. Interest is paid when the loan matures one year from the issue date. What is the adjusting entry for accruing interest that Bradley would need to make on December 31, the calendar year-end?

Use the information in the adjusted trial balance presented below to calculate the current ratio for Taproot Company:  Account Title Dr.   Cr. Cash $ 23,000         Accounts receivable   16,000         Prepaid insurance   6,600         Equipment   100,000         Accumulated depreciation—Equipment       $ 50,000   Land   95,000         Accounts payable         17,000   Interest payable         2,400   Unearned revenue         5,000   Long-term notes payable         30,000   Retained earnings         136,200   Totals $ 240,600   $ 240,600  

On October 1, Badlands Company rented warehouse space to a tenant for $2,500 per month. The tenant paid five months’ rent in advance on that date, with the lease beginning immediately. The cash receipt was credited to the Unearned Rent account. The company’s annual accounting period ends on December 31. The adjusting entry needed on December 31 is:

On January 1 of the current year, Josie’s Hoagie Co. reported stockholders’ equity totaling $122,500. During the current year, total revenues were $96,000 while total expenses were $85,500. Also, during the current year paid $20,000 in cash dividends. No other changes in equity occurred during the year. If, on December 31 of the current year, total assets are $196,000, the change in total stockholders’ equity during the year was:

Increases in equity from a company’s sales of products or services are:

Depot Train Services had revenues of $80,000 and expenses of $50,000 for the year. Its assets at the beginning of the year were $400,000. At the end of the year assets were worth $450,000. Calculate its return on assets.

Increases in equity from a company’s sales of products or services are:

Owner financing refers to resources contributed by creditors or lenders.

The Extra Company acquired a building for $500,000. The building was appraised at a value of $575,000. The seller had paid $300,000 for the building 6 years ago. Which accounting principle would require Extra to record the building on its records at $500,000?