Question: Lang Enterprises was started when it acquired $4,000 cash from creditors and $6,000 from owners. The company immediately purchased land that cost $9,000. Required a.

Lang Enterprises was started when it acquired $4,000 cash from creditors and $6,000 from owners. The company immediately purchased land that cost $9,000.


Required

a. Record the events under an accounting equation.

b. After all events have been recorded, Lang's obligations to creditors represents what percent of total assets?

c. After all events have been recorded, Lang's stockholder's equity represents what percent of total assets?

d. Assume the debt is due. Given that Lang has $6,000 in stockholders' equity, can the company repay the creditors at this point? Why or why not?


Step by Step Solution

3.34 Rating (169 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock

a Cash Land Creditors Stockholders Equity 10000 0 4000 6000 9000 9000 NA NA Bal 1000 90... View full answer

blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Document Format (1 attachment)

Word file Icon

264-B-A-A-C (2308).docx

120 KBs Word File

Students Have Also Explored These Related Accounting Questions!

Related Book