The following transactions occur for the Panther Detective Agency during the month of July: 1

a. Purchased a truck and signed notes payable for $14,700:

The following is the accounting equation for the entry:

Assets = Liabilities + Stakeholder's Equity

Asset = Equipment

Liability = Notes Payable

Equipment (A+)Dr. 14,700

Notes payable (L+)Cr. 14,700

(To record the purchase of supplies)

Equipment is an asset and increased by $14,70. Therefore, debit equipment account with $14,700.

Notes payable is a liability and increased by $14,700. Therefore, credit the notes payable account

B. Purchased supplies for cash, $570:

The following is the accounting equation for the entry:

Asset = Supplies 570+ Cash 570-

Supplies (A+)Dr. 570

Cash a/c Cr.. 570

(To record the purchase of supplies)

Supplies are an asset and increased by $570. Therefore, debit supplies account with $570.

Cash is an asset and decreased by $570. Therefore, credit cash account with $570.

(c) Paid rent expenses of $770.

The following is the accounting equation for the entry:

Asset = Cash 770-

Shareholder's Equity = Rent Expenses 770+

Rent Expense Dr. 770

Cash Cr.. 770

(To record the payment of repair expense)

Rent expense is an expense and increased by $770. Therefore, debit Rental expense account with $770.

Cash is an asset and decreased by $770. Therefore, credit cash account with $770.