Question

Ckson's Programming paid its June of $500 cash. demonstrate how to use the accounting equation to record the transaction by completing the following sentence.
Jackson would decrease _________ and increase ________ in the accounting equation.

Answer 1

Answer:

Decrease Cash and Increase Expense

Explanation:

Jackson Programming paid $500 as rent for the month of June.

The accounting equation is is the basis of the double entry accounting principle system. It is an equation that stipulates that the balance sheet must remain balanced meaning every entry on the debit should be followed with a corresponding credit. It also means for every decrease there should be a corresponding increase.

In Jackson Programming;

A decrease is recorded in CASH because cash was paid, while an increase is recorded in EXPENSE because there is a corresponding increase in rent expenses.