During 2017, its first year of operations as a delivery service, Persimmon Corp. entered into the following

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During 2017, its first year of operations as a delivery service, Persimmon Corp. entered into the following transactions.

1. Issued shares of common stock to investors in exchange for $100,000 in cash.

2. Borrowed $45,000 by issuing bonds.

3. Purchased delivery trucks for $60,000 cash.

4. Received $16,000 from customers for services performed.

5. Purchased supplies for $4,700 on account.

6. Paid rent of $5,200.

7. Performed services on account for $10,000.

8. Paid salaries of $28,000.

9. Paid a dividend of $11,000 to shareholders.

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. Use Illustration 3-3 (page 99) as a model.

During 2017, its first year of operations as a delivery
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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Related Book For  book-img-for-question

Financial Accounting Tools for Business Decision Making

ISBN: 978-1118953907

8th edition

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

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