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Case Study 5
Case Study is analyzed looking at transactions and its effects on the accounting equation, by checking balance sheet and income statement effect at each step of transaction.
Transaction 1:
| Journal Entry | Account Title and Description | Debit | Credit |
| 1.0 | Cash | 30,000,000 | |
| Capital | 30,000,000 |
Balance Sheet
| Assets | Liabilities | ||
| Cash | 30,000,000 | Owners’ Equity | |
| Capital | 30,000,000 | ||
| Total Assets | 30,000,000 | Total Liabilities and Owners Equity | 30,000,000 |
Owner Invested cash $30m into the business increasing the cash and capital which results into increase of equity. There is no effect on the income statement.
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