This problem can be used in conjunction with Problem 2-50A. Refer to Problem 2-50A. In Problem 2-50A The following amounts
This problem can be used in conjunction with Problem 2-50A. Refer to Problem 2-50A.
In Problem 2-50A
The following amounts summarize the financial position of Ready Resources, Inc., on May 31, 20X8:
During June 20X8, Ready Resources completed these transactions:
a. The business received cash of $5,000 and issued common stock.
b. Performed services for a customer and received cash of $6,700.
c. Paid $5,000 on accounts payable.
d. Purchased supplies on account, $1,000.
e. Collected cash from a customer on account, $500.
f. Consulted on the design of a computer system and billed the customer for services rendered, $2,400.
g. Recorded the following business expenses for the month: (1) paid office rent-$900; (2) paid advertising-$300.
h. Declared and paid a cash dividend of $1,800.
1. Journalize the transactions of Ready Resources, Inc. Explanations are not required.
2. Set up the following T-accounts: Cash, Accounts Receivable, Supplies, Land, Accounts Payable, Common Stock, Retained Earnings, Dividends, Service Revenue, Rent Expense, and Advertising Expense. Insert in each account its balance as given (example: Cash $1,200). Post the transactions to the accounts.
3. Compute the balance in each account. For each asset account, each liability account, and for Common Stock, compare its balance to the ending balance you obtained in Problem 2-50A. Are the amounts the same or different?
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...
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