The bank statement for Raymond Company included a debit memo for a bank service charge of $50.Required:a) Enter this event into the horizontal financial statements model. Indicate dollar amounts of increases and decreases; for accounts that are not affected, indicate NA. For cash flows, show whether they are operating activities (OA), investing activities (IA), or financing activities (FA).Assets=Liab.+Stk. EquityRev.-Exp.=Net Inc.Stmt of Cash Flowsb) Is the bank service charge an asset source, use, or exchange transaction?c) Record in general journal form any necessary entries to the Cash account to adjust it to the true cash balance.
What will be an ideal response?
a)
| Assets | = | Liab. | + | Stk. Equity | Rev. | - | Exp. | = | Net Inc. | Stmt of Cash Flows |
| (50) | ? | NA | ? | (50) | NA | ? | 50 | ? | (50) | (50) OA |
c)
| Account Titles | Debit | Credit |
| Bank service charge expense | 50 | ? |
| Cash | ? | 50 |
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