E25 Determining Financial Statement Effects of Several Trans

E2-5 Determining Financial Statement Effects of Several Transactions [LO 2-1, LO 2-2, LO 2-5 NKE, Ine. with headquarters in Beaverton, Oregon, is one of the worlds leading manufacturers of athletic shoes and sports apparel. The following activisies occuned during a recent yew The amounts are presented in millions of dolars a. Prtased $2,6 neg prent paid by signing a SS4erm foto and Mfling he rest with cast c Several NIKCE Investors sold heir own stock to other investors on the slock exchange for $110 per share of stock Required 1. For each of these events, perform transaction analysis and indicate the account, amount (in millions), and direction of the efflect on the accounting equation Check that the accounting equation remains in balance aher each transaction. (Enter any decreases te account balances with a minus sign. Enter your answers in millions (,10,000,000 should be entered as 10 Totals

Solution

Asset = Liability + Stockholders\' equity Account Amount = Account Amount + Account Amount a. Equipment 216 = Note payable 5 + Cash -211 b. Cash 21 = + Common stock 21 c. No effect = No effect + No effect Total 26 = 5 + 21 c. The sale of shares by the investors to other investors on the stock market does not have any effect on the company\'s      accounts.