1. 2 3. 4 5 In Year 1, a company's first year of business, the following...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
1. 2 3. 4 5 In Year 1, a company's first year of business, the following events occurred: 6. 7 1. Received $32,000 from issuing common stock. 2. Received $44,000 from issuing a note to National Bank. 3. Received $60,000 when services were performed for customers. Required a. Show the effects of the Year 1 events on the company's financial statements. The first event is recorded as an example. (Enter any decreases to account balances with a minus sign. Leave cells blank if there is no effect.) 8 4. Paid $51,000 for expenses used to provide services. 5. Paid $2,200 in dividends to stockholders. Event No. 6. Received $32,000 from issuing additional common stock. 7. Paid $11,000 to reduce the balance of the note. 8. Paid $49,000 to purchase land. 9. Determined that the market value of the land is $69,000. (Hint: Assets used in a company's business, like land, are generally reported at historical cost in the financial statements.) 9. Total Cash Assets 32,000+ 44,000+ 60,000+ (51,000)+ (2.200)+ 32,000+ (11,000)+ (49,000)+ 54,800 + Land Balance Sheet -Liabilities + Stockholders Equity F 49,000 = 49,000 - Notes Payable + 44,000+ (11,000) + Common Retained Revenue Stock Earnings 32,000+ + 33,000+ 64,000 + ++ 32,000+ + * (2,200) Income Statement (2.200) 60,000 60,000 Expense (51,000) (51,000) Net Income 0 1. 2 3. 4 5 In Year 1, a company's first year of business, the following events occurred: 6. 7 1. Received $32,000 from issuing common stock. 2. Received $44,000 from issuing a note to National Bank. 3. Received $60,000 when services were performed for customers. Required a. Show the effects of the Year 1 events on the company's financial statements. The first event is recorded as an example. (Enter any decreases to account balances with a minus sign. Leave cells blank if there is no effect.) 8 4. Paid $51,000 for expenses used to provide services. 5. Paid $2,200 in dividends to stockholders. Event No. 6. Received $32,000 from issuing additional common stock. 7. Paid $11,000 to reduce the balance of the note. 8. Paid $49,000 to purchase land. 9. Determined that the market value of the land is $69,000. (Hint: Assets used in a company's business, like land, are generally reported at historical cost in the financial statements.) 9. Total Cash Assets 32,000+ 44,000+ 60,000+ (51,000)+ (2.200)+ 32,000+ (11,000)+ (49,000)+ 54,800 + Land Balance Sheet -Liabilities + Stockholders Equity F 49,000 = 49,000 - Notes Payable + 44,000+ (11,000) + Common Retained Revenue Stock Earnings 32,000+ + 33,000+ 64,000 + ++ 32,000+ + * (2,200) Income Statement (2.200) 60,000 60,000 Expense (51,000) (51,000) Net Income 0
Expert Answer:
Answer rating: 100% (QA)
Balance Sheet Assets Cash 54000 Land 49000 Liabilities Notes Payable 33000 Stockholders Equity Commo... View the full answer
Related Book For
Interpreting and Analyzing Financial Statements
ISBN: 978-0132746243
6th edition
Authors: Karen P. Schoenebeck, Mark P. Holtzman
Posted Date:
Students also viewed these accounting questions
-
Account Titles cash in bank ordinary share capital share premium-ordinary preference share share premium-ps ppe-building ppe-land mortgage payable ppe-office furnitures & Notes Payable Smallspoon...
-
The following additional information is available for the Dr. Ivan and Irene Incisor family from Chapters 1-5. Ivan's grandfather died and left a portfolio of municipal bonds. In 2012, they pay Ivan...
-
example given below Tasks: 1. Using the residual income model, prepare a valuation of the common stock of Best Buy as of Year 2 under the following assumptions (use Exhibit 9.6 in the textbook as an...
-
Consider again examples 9.2 and 9.3 , and once again assume that there are two states of the world for each random variable, denoted by V L j , V H j and n L , n H . Denote the probabilities for...
-
The Daisy Company received a bank statement for February 2007, as follows: From: Central Bank, Denver, Co. 80222 To: Daisy Company, 1313 Williams St., Denver, Co. 80218 The receipt of $460 on...
-
The statement of financial position of Aadvaark Trading Ltd at 30 November 2023 (with comparatives for 2022) is as follows: Statement of financial position at 30 November 2023 The following...
-
A centrifugal pump having the characteristics shown in Example 12.4 is used to pump water between two large open tanks through \(100 \mathrm{ft}\) of 8-in.-diameter pipe. The pipeline contains four...
-
Information related to Hermesch Company for 2010 is summarized below. Total credit sales............ $2,200,000 Accounts receivable at December 31.... 825,000 Bad debts written off........ 33,000...
-
1. Analyze and explain the theoretical concepts related to the balance of payments of a country. A country has exports of $20 billion, imports of $25 billion, net transfers from abroad of $1 billion,...
-
The balance sheets of Forest Company and Garden Company are presented below as at December 31, Year 8. Additional Information Forest acquired 90% of Garden for $207,900 on July 1, Year 1, and...
-
1. Which of the following formulas can be considered an algorithm for computing the area of a triangle whose side lengths are given positive numbers a, b, and c? Explain these. a. Sp(p-a)(p - b)(pc),...
-
Current technology gives project managers instant access to cost accounting systems virtually anytime. Why is weekly reporting still the most common cycle for construction cost accounting reports?
-
Why does the project manager focus primarily on labor and equipment costs and less on materials, subcontracts, and project overhead?
-
Given the Supreme Court's "discovery" of penumbras in the Bill of Rights such as the right to privacy, should this right be extended to assisted suicide for terminally ill patients and/or access to...
-
What do you mean by the term Auditors Independence? How can you differentiate between Independence in fact and Independence in appearance? How the independence of an auditor can be ensured?
-
The construction team uses various models to describe the project that is to be built. What are the various models used by the construction team, and what does each depict?
-
Suppose the risk-free interest rate is 5.1% APR with monthly compounding. If a $3.8 million MRI machine can be leased for 4 years for $71,500 per month, what residual value must the lessor recover to...
-
Briefly describe the following types of group life insurance plans: a. Group term life insurance b. Group accidental death and dismemberment insurance (AD&D) c. Group universal life insurance d....
-
Q1. When amounts are correct, the accounting equation, Assets = Liabilities + Stockholders Equity, (_________ / will not) always be in balance. Similarly, Debits (_________/ will not) always equal...
-
Q1. Research the following current interest rates. These rates are available on the Internet and at a local bank or credit union. The current rates banks/credit unions are offering/asking are a....
-
Q1. Prepare a trend analysis of Sales Revenue for all four years: The greatest increase took place in (2010 / 2009 / ___________). What are some likely reasons for this increase? Q2. The greatest...
-
Victoria has prepared the following list of statements about corporations. 1. A corporation is an entity separate and distinct from its owners. 2. As a legal entity, a corporation has most of the...
-
Indicate whether the following items would appear on the income statement (IS), statement of financial position (SFP), or retained earnings statement (RES). a. Dividends. b. Cash. c. Salaries and...
-
On May 10, Chen Co. issues 2,000 6 par value ordinary shares for cash at 13 per share. Journalize the issuance of the shares.
Study smarter with the SolutionInn App