Scott Bennett is preparing his balance sheet and income and expense statement for the year ending June 30, 2016. He is having difficulty classifying six items and asks for your help. Which, if any, of the following transactions are assets, liabilities, income, or expense items?
1. Scott rents a house for $1,350 a month.
2. On June 21, 2016, Scott bought diamond earrings for his wife and charged them using his MasterCard. The earrings cost $900, but he hasn't yet received the bill.
3. Scott borrowed $3,500 from his parents last fall, but so far, he has made no payments to them.
4. Scott makes monthly payments of $225 on an installment loan; about half of it is interest, and the balance is repayment of principal. He has 20 payments left, totaling $4,500.
5. Scott paid $3,800 in taxes during the year and is due a tax refund of $650, which he hasn't yet received.
6. Scott invested $2,300 in some common stock.