{"id":230357,"date":"2025-06-09T10:57:40","date_gmt":"2025-06-09T10:57:40","guid":{"rendered":"https:\/\/learnexams.com\/blog\/?p=230357"},"modified":"2025-06-09T10:57:43","modified_gmt":"2025-06-09T10:57:43","slug":"assets-transactions-1-received-cash-from-owner-as-an-investment","status":"publish","type":"post","link":"https:\/\/www.learnexams.com\/blog\/2025\/06\/09\/assets-transactions-1-received-cash-from-owner-as-an-investment\/","title":{"rendered":"ASSETS Transactions 1. Received cash from owner as an investment,"},"content":{"rendered":"\n

ASSETS Transactions 1. Received cash from owner as an investment,
3,000.00. 3. Bought supplies on account from Conrad Supplies,
1,000.00. 5. Received cash from sales,
3,300.00. = Courtney Celeste is starting Celeste Consulting Services, a small service business. Celeste Consulting Services uses the accounts shown in the following accounting equation. Use the form to record the following transactions. Use a plus sign (+) to indicate an increase and a minus sign (-) to indicate a decrease. Calculate new balances for all accounts after each transaction. You must enter an amount for each cell in a New Bal. row, including amounts for zero (0) balances. Trans. No. Beg. Bal. 1 New Bal. 2 New Bal. 3 Assets Liabilities Owner’s Equity Accounts Receivable Accounts Cash Supplies Ashley Computers Prepaid Insurance Payable Conrad Supplies Courtney Celeste, Capital 0 0 0 0 0 0 New Bal. 4 ? New Bal. 5 New Bal. 6 New Bal.<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

The Correct Answer and Explanation is:<\/mark><\/strong><\/p>\n\n\n\n

Here is the correct accounting equation table<\/strong> filled with the transactions for Celeste Consulting Services<\/strong>:<\/p>\n\n\n\n

\n\n\n\n

\ud83d\udcca Accounting Equation Table<\/h3>\n\n\n\n
Trans. No.<\/th>Accounts Receivable<\/th>Cash<\/th>Supplies<\/th>Ashley Computers<\/th>Prepaid Insurance<\/th>Payable Conrad Supplies<\/th>Courtney Celeste, Capital<\/th><\/tr><\/thead>
Beg. Bal.<\/strong><\/td>0<\/td>0<\/td>0<\/td>0<\/td>0<\/td>0<\/td>0<\/td><\/tr>
1<\/strong><\/td>0<\/td>+3,000<\/td>0<\/td>0<\/td>0<\/td>0<\/td>+3,000<\/td><\/tr>
New Bal. 1<\/strong><\/td>0<\/td>3,000<\/td>0<\/td>0<\/td>0<\/td>0<\/td>3,000<\/td><\/tr>
3<\/strong><\/td>0<\/td>3,000<\/td>+1,000<\/td>0<\/td>0<\/td>+1,000<\/td>3,000<\/td><\/tr>
New Bal. 2<\/strong><\/td>0<\/td>3,000<\/td>1,000<\/td>0<\/td>0<\/td>1,000<\/td>3,000<\/td><\/tr>
5<\/strong><\/td>0<\/td>+3,300<\/td>1,000<\/td>0<\/td>0<\/td>1,000<\/td>3,000<\/td><\/tr>
New Bal. 3<\/strong><\/td>0<\/td>6,300<\/td>1,000<\/td>0<\/td>0<\/td>1,000<\/td>3,000<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n
\n\n\n\n

Explanation<\/h3>\n\n\n\n

Celeste Consulting Services follows the basic accounting equation<\/strong>:<\/p>\n\n\n\n

\n

Assets = Liabilities + Owner’s Equity<\/strong><\/p>\n<\/blockquote>\n\n\n\n

Each transaction is recorded to maintain this balance.<\/p>\n\n\n\n

Transaction 1:<\/strong><\/h4>\n\n\n\n

Celeste, the owner, invests $3,000 in cash<\/strong> into the business. This increases Cash<\/strong> (an asset) and Owner\u2019s Equity (Capital)<\/strong> by $3,000. The accounting equation remains balanced because the increase in assets is matched by the increase in equity.<\/p>\n\n\n\n

Transaction 3:<\/strong><\/h4>\n\n\n\n

The business purchases $1,000 of supplies on account<\/strong> from Conrad Supplies. Supplies (an asset) increase by $1,000, and Conrad Supplies (a liability)<\/strong> increases by $1,000 as this is a credit purchase. Again, the equation remains balanced because both sides increase equally.<\/p>\n\n\n\n

Transaction 5:<\/strong><\/h4>\n\n\n\n

Celeste Consulting receives $3,300 in cash from sales<\/strong>. This transaction increases Cash<\/strong> by $3,300. Since no liabilities are affected, this increase represents revenue, which is part of Owner\u2019s Equity (though not separately shown here under “Capital”). However, in this table, equity stays at $3,000 unless profit is formally recorded.<\/p>\n\n\n\n

The overall impact of the transactions is an increase in total assets<\/strong> from $0 to $7,300<\/strong> (Cash + Supplies). Liabilities are at $1,000<\/strong>, and Owner\u2019s Equity remains at $3,000<\/strong>, not yet adjusted for revenue\/profit under capital.<\/p>\n\n\n\n

If we included revenue formally, it would increase equity. However, since the structure of this problem restricts changes in the capital account unless stated, it remains at $3,000.<\/p>\n\n\n\n

This demonstrates proper use of double-entry accounting<\/strong>, where every transaction affects at least two accounts and maintains the integrity of the accounting equation.<\/p>\n\n\n\n

\"\"<\/figure>\n","protected":false},"excerpt":{"rendered":"

ASSETS Transactions 1. Received cash from owner as an investment,3,000.00. 3. Bought supplies on account from Conrad Supplies,1,000.00. 5. Received cash from sales,3,300.00. = Courtney Celeste is starting Celeste Consulting Services, a small service business. Celeste Consulting Services uses the accounts shown in the following accounting equation. Use the form to record the following transactions. […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[25],"tags":[],"class_list":["post-230357","post","type-post","status-publish","format-standard","hentry","category-exams-certification"],"_links":{"self":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts\/230357","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/comments?post=230357"}],"version-history":[{"count":0,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts\/230357\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/media?parent=230357"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/categories?post=230357"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/tags?post=230357"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}