Analyze transactions ag, as in the example below for transaction a. a. Sarah Lopez established Sarahs Beauty

Question:

Analyze transactions a–g, as in the example below for transaction a.

a. Sarah Lopez established Sarah’s Beauty Parlor, Inc., by incorporating and investing $2,500 in exchange for 250 shares of $10 par value common stock.

b. Paid two months’ rent in advance, $1,680.

c. Purchased supplies on credit, $120.

d. Received cash for hair services, $700.

e. Paid for supplies purchased in c.

f. Paid utility bill, $72.

g. Declared and paid a dividend of $100.

Example
a. The asset account Cash was increased. Increases in assets are recorded by debits. Debit Cash $2,500. A component of stockholders’ equity, Common Stock, was increased. Increases in stockholders’ equity are recorded by credits. Credit Common Stock $2,500.

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... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their... Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...

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