The following are independent situations. a. A new company is formed and sells 100 shares of...

 

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The following are independent situations. a. A new company is formed and sells 100 shares of $1 par value stock for $12 per share to investors. b. A company purchases for $18,000 cash a new delivery truck that has a list, or sticker, price of $21,000. c. A women's clothing retailer orders 30 new display stands for $300 each for future delivery. d. A company orders and receives 10 personal computers for office use for which it signs a note promising to pay $25,000 within three months. e. A construction company signs a contract to build a new $500,000 warehouse for a corporate customer. At the signing, the corporation writes a check for $50,000 to the construction company as the initial payment for the construction (receiving construction in progress). Answer from the standpoint of the corporation (not the construction company). f. A publishing firm purchases for $40,000 cash the copyright (an intangible asset) to a manuscript for an introductory accounting text. g. A manufacturing firm declares a $100,000 cash dividend to be distributed to stockholders next period. h. A company purchases a piece of land for $50,000 cash. An appraiser for the buyer values the land at $52,500. i. A manufacturing company acquires the patent (an intangible asset) on a new digital satellite system for television reception, paying $500,000 cash and signing a $400,000 note payable due in one year. j. A local company is a sole proprietorship (one owner); its owner buys a car for $10,000 for personal use. Answer from the local company's point of view. k. A company purchases 100 shares of Apple Incorporated common stock as an investment for $5,000 cash. 1. A company borrows $1,000 from a local bank and signs a six-month note for the loan. m. A company pays $1,500 principal on its note payable (ignore interest). The following are independent situations. a. A new company is formed and sells 100 shares of $1 par value stock for $12 per share to investors. b. A company purchases for $18,000 cash a new delivery truck that has a list, or sticker, price of $21,000. c. A women's clothing retailer orders 30 new display stands for $300 each for future delivery. d. A company orders and receives 10 personal computers for office use for which it signs a note promising to pay $25,000 within three months. e. A construction company signs a contract to build a new $500,000 warehouse for a corporate customer. At the signing, the corporation writes a check for $50,000 to the construction company as the initial payment for the construction (receiving construction in progress). Answer from the standpoint of the corporation (not the construction company). f. A publishing firm purchases for $40,000 cash the copyright (an intangible asset) to a manuscript for an introductory accounting text. g. A manufacturing firm declares a $100,000 cash dividend to be distributed to stockholders next period. h. A company purchases a piece of land for $50,000 cash. An appraiser for the buyer values the land at $52,500. i. A manufacturing company acquires the patent (an intangible asset) on a new digital satellite system for television reception, paying $500,000 cash and signing a $400,000 note payable due in one year. j. A local company is a sole proprietorship (one owner); its owner buys a car for $10,000 for personal use. Answer from the local company's point of view. k. A company purchases 100 shares of Apple Incorporated common stock as an investment for $5,000 cash. 1. A company borrows $1,000 from a local bank and signs a six-month note for the loan. m. A company pays $1,500 principal on its note payable (ignore interest).

Answer rating: 100% (QA)

Lets address each situation stepbystep explaining the accounting implications for each onea A new company issues 100 shares of 1 par value stock at12 per shareExplanation When a company issues stock i... View the full answer