Delmont Company entered into these transactions during May 2012. 1. Purchased computers for office use for $30,000

Question:

Delmont Company entered into these transactions during May 2012.

1. Purchased computers for office use for $30,000 from Dell on account.

2. Paid $4,000 cash for May rent on storage space.

3. Received $12,000 cash from customers for contracts billed in April.

4. Provided computer services to Lawton Construction Company for $5,000 cash.

5. Paid Southern States Power Co. $8,000 cash for energy usage in May.

6. Stockholders invested an additional $40,000 in the business in exchange for common stock of the company.

7. Paid Dell for the computers purchased in (1).

8. Incurred advertising expense for May of $1,300 on account.

Instructions

Using the following tabular analysis, show the effect of each transaction on the accounting equation. Put explanations for changes to Stockholders Equity in the right-hand margin.

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Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on...
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Financial Accounting Tools for business decision making

ISBN: 978-0470534779

6th Edition

Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso

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