Using this format how would you fill out the balance sheet for the following information: Summary of
Question:
Using this format how would you fill out the balance sheet for the following information:
Summary of Events
January 1 – You started the business by contributing $100,000 of personal capital in exchange for common stock
January 1 – Paid $5,000 to the lawyers to incorporate your business entity
January 2 – Acquired computers for the business for $5,000
January 3 – Acquired inventory held for re-sale for $20,000
January 4 – The first sale took place, as you sold half of the inventory originally purchased. You sold it for $50,000 cash
February 1 – You hired your first employee, and paid $5,000 cash for wages. You paid the same amount of wages on the first of each month for the remainder of the year.
February 15 – Sold the rest of the inventory for $75,000 cash
March 15 – You got sued by an outside party, and got an invoice from lawyers for $2,000 for legal work performed, due in April
April 1 – Paid the legal invoice due
April 25 – Bought more inventory from your supplier, for $20,000 on credit
May 1 – Borrowed $100,000 from the bank, at an annual rate of 10%, due on December 31.
May 31 – Sold all remaining inventory for $50,000, on credit.
June 30 – Collected on all outstanding Accounts Receivable.
July 15 – Sold all of the computers for $1,000 in cash.
September 1 – bought more inventory, for $30,000 using long-term note payable.
October 1 – sold inventory – all that you had on hand, for $50,000 on credit.
November 1 – collected on accounts receivable, in all cash.
December 31 – made an interest payment on the note
December 31 – paid $5,000 bonus in cash to employee.
December 31 – after books were closed, you paid 50% of all the remaining profit as cash dividends.
Accounting Principles
ISBN: 978-1119048473
7th Canadian Edition Volume 2
Authors: Jerry J. Weygandt, Donald E. Kieso, Paul D. Kimmel, Barbara Trenholm, Valerie Warren, Lori Novak