Business tax return Brisbane

So you can consider revenue and expense as part of equity revenue has a positive impact on equity expense has a negative impact on equity does that make sense so right now just remember revenue and expense is part of equity here’s another exercise for you identify for each transaction the type of equity involved then indicate if the company’s equity is increased or decreased take your time this very important stop now do this exercise and then proceed once you’re done I’ll give you the answers I done let’s take the first one the company sold thousand shares of common stock for 30 so the answer is what type of equity was affected its common stock and the impact on equity was positive plus 30 the company paid eight thousand for rent what got affected expense the impact on equity negative eight thousand remember expenses are bad for equity so.

Goods generated thirty thousand in revenue what did you put the answer is revenue impact on equities positive revenue has a good impact on equity the company paid five thousand on loan from its bank and this is what’s in accounting called the shaft you paid five thousand impact on equity was nothing why is that because only assets and liabilities were affected by this transaction so the impact on equity was nothing this finishes module 1 the purpose of the module was to explain what assets are what liabilities are what revenues are what accept expenses are and to explain the concept of equity.

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