Question

Rawlco Communications operates 15 radio stations. The following events occurred during September.
a. Placed an order for office supplies costing $ 2,000. Supplier intends to deliver later in the month.
b. Purchased equipment that cost $ 30,000; paid $ 10,000 cash and signed a promissory note to pay $ 20,000 in one month.
c. Negotiated and signed a one- year bank loan, and then deposited $ 5,000 cash in the company’s checking account.
d. Hired a new finance manager on the last day of the month.
e. Received an investment of $ 10,000 cash from the company’s owners in exchange for issuing common shares.
f. Supplies [ordered in (a)] were received, along with a bill for $ 2,000.
Required:
1. Indicate the specific account, amount, and direction of effects for each transaction on the radio station’s accounting equation. If an event is not considered a transaction, explain why.
2. Prepare journal entries to record each transaction.
3. Rawlco began the month with $ 220,000 in total assets. What total assets would be reported on the balance sheet after events (a)–(f) ?


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  • CreatedNovember 02, 2015
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