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You preform a business service for which you charge $575. You receive $200 in cash and a promissory note for the balance, payable in 60 days. What steps will you use to show this transaction on your balance sheet?

Respuesta :

akiran007

Answer:

Cash is increased by $ 200 , and Notes Receivable is also increased by $ 375

Revenue Earned is also increased By $ 575.

Step-by-step explanation:

We make a journal entry

Cash      $200 Debit

Notes Receivable   $ 375 Debit

Services Revenue Earned                        $ 575 Credit

In the balance sheet the Cash is increased by $ 200 , and Notes Receivable is also increased by $ 375  on the Assets sides.

On the  Liabilities side in the Owner's Equity section  Revenue Earned is also increased By $ 575.

Increasing both sides ( Assets and Liabilities sections) with equal amounts will  have no effect on the Balance Sheet .

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