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Question One 10 marks Torch of Freedom is a security consulting business. On December 31,...

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Question One 10 marks Torch of Freedom is a security consulting business. On December 31, 2019, they had assets of $495,000 and liabilities of $97,000. Using the accounting equation, determine the following amounts: Stockholders' equity as of December 31, 2019. 1. Stockholders' equity as of December 31, 2020, assuming that assets decreased by $65,000 and liabilities increased by $36,000 during 2020. Question Two 20 marks Isshita Thought Production is owned and led by Isshita Karim. The following selected transactions were completed by Isshita Thought Production during October 1 Received cash in exchange for common stock, S25,000. 2. Paid advertising expense, $3,850. 3. Purchased supplies on account, $2,100. 4. Billed customers for consulting services on account, $15,700. 5. Received cash from customers on account, $8,500. 6. Received cash for services performed, 3,100. Indicate the effect of each transaction on the following accounting equation elements: Assets, Liabilities, Common Stock, Dividends, Revenue, and Expense. To illustrate, the answer to (1) follows: (1) Assets (Cash) increases by $25,000: Common Stock increases by $25,000. (2) (3) (4) (5) (6)

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