1. Issued 30,000 shares of no-par common stock in exchange for $300,000 in cash. 2. Purchased equipment at a cost of $40,000. Cash of $10,000 was paid and a note payable to the seller was signed for the balance owed, 3. Purchased inventory on account at a cost of $90,000. The company uses the perpetual inventory system. 4. Credit sales for the month totaled $120,000. The cost of the goods sold was $70,000. 5. Paid $5,000 in rent on the warehouse building for the month of March 6, Paid $6,000 to an insurance company for fire and liability insurance for a one-year period beginning April 1, 2024. 7. Paid $70,000 on account for the inventory purchased in transaction 3. 8. Collected $55,000 from customers on account. 9. Recorded depreciation expense of $1,000 for the month on the equipment. Required: Analyze each transaction and show the effect of each on the expanded accounting equation for a corporation. Note: Amounts to be deducted should be indicated by a minus sign. Enter the net change on the accounting equation.

1. Issued 30,000 shares of no-par common stock in exchange for $300,000 in cash. 2. Purchased equipment at a cost of $40,000. Cash of $10,000 was paid and a note payable to the seller was signed for the balance owed, 3. Purchased inventory on account at a cost of $90,000. The company uses the perpetual inventory system. 4. Credit sales for the month totaled $120,000. The cost of the goods sold was $70,000. 5. Paid $5,000 in rent on the warehouse building for the month of March 6, Paid $6,000 to an insurance company for fire and liability insurance for a one-year period beginning April 1, 2024. 7. Paid $70,000 on account for the inventory purchased in transaction 3. 8. Collected $55,000 from customers on account. 9. Recorded depreciation expense of $1,000 for the month on the equipment. Required: Analyze each transaction and show the effect of each on the expanded accounting equation for a corporation. Note: Amounts to be deducted should be indicated by a minus sign. Enter the net change on the accounting equation.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Geary Corporation had the following transactions: · Apr. 15 - Received $6,000 from Marion Company and signed a 60-day, eight percent note payable. · May 22 - Borrowed $50,000 from Sinclair Bank, signing a 60-day note at nine percent. · June 14 - Paid Marion Company the principal and interest due on the April 15th note payable. July 13 - Purchased $15,000 of merchandise from Sharp Company; signed a 90-day note with eight percent interest. July 21 - Paid the May 22 note due to Sinclair Bank. · Oct 02 - Borowed $38,000 from Sinclair Bank, signing a 120-day note at twelve percent interest. · Oct 11 - Paid the note payable and accrued interest to the Sharp Company (July 13). Required: 1. Record these transactions in a general journal format. 2. Record any adjusting entries for interest in a general journal format. Geary Corporation has a December 31 year-end.
Prime entries.
Don Pedro has not kept accurate accounting records during the financial year. He had opening inventory of $6,700. Additional goods were purchased during the year. At the year end he had $5,400 left in inventory. Total sales was $102,360 All sales are made at a mark up on cost of 20%. What is Don Pedro’s gross profit for the year? a. $13,750 b. $17,060 c. $16,540 d. $20,675
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Cash Hard #1
The following information is available for Jaworski second year in business: • Opening merchandise inventory is 35,000. • Goods are marked to sell at 35% above cost. • Merchandise purchased totalled 600,000. • Collections from customers are 420,000. • Ending merchandise inventory is 225,000. • Opening accounts receivable balance is 0. • Ending accounts receivable balance is 85,000. Required: a. Estimate the ending accounts receivable that should appear in the ledger. Calculate any shortages, if any. Assume that all sales are made on account. b. What controls can be put in place to prevent theft?
4
Prepre Journal Entries May Made cash sales of $7,100; the cost of the inventory was $3,600. 1 5 Purchased $2,400 of inventory on credit. 9. Made credit sales of $3,300; the cost of the inventory sold was $2,100. 13 Paid sales salaries of $1,100 and office salaries of $400.
Germo Company started business at the beginning of the current year. The entity established an allowance for doubtful accounts estimated at 5% of credit sales. During the year, the entity wrote off P50,000 of uncollectible accounts. Further analysis showed that the merchandise purchased amounted to P9,000,000 and ending merchandise inventory was P1,500,000. Goods were sold at 40% above cost. The total sales comprised 80% sales on account and 20% cash sales. Total collections from customers, excluding cash sales, amounted to P6,000,000. What is the amount of sales on account?
Keep Calm Company provided the following information for the current year: Accounts receivable, January 1 2,100,000 Accounts receivable, December 31 2,700,000 Collections of accounts during the year 9,000,000 Inventory, January 1 4,500,000 Purchases during the year 5,800,000 All sales are made on account. The mark up on cost is 20% What is the estimated inventory at December 317
The balance of Total Assets for Virtue Company is $500,000 on November 30. During November, the following took place:Sold $60,000 of inventory for cashPurchased a $100,000 machine for cashIncreased accounts payable $50,000 by acquisitions of inventory on accountWrote off accounts receivable of $20,000Total Assets for Virtue Company on November 1 is: Multiple Choice $550,000 $530,000 none of the other alternatives are correct $500,000 $450,000
Henderson Company uses the gross profit method to estimate ending inventory and cost of goods sold when preparing monthly financial statements required by its bank. Inventory on hand at the end of July was $119,000. The following information for the month of August was available from company records: Purchases Freight-in Sales Sales returns Purchases returns $ 212,000 4,500 343,000 8,300 3,600 In addition, the controller is aware of $12,000 of inventory that was stolen during August from one of the company's warehouses. 1. Estimated ending inventory 2. Estimated ending inventory Required: 1. Calculate the estimated inventory at the end of August, assuming a gross profit ratio of 25%. 2. Calculate the estimated inventory at the end of August, assuming a markup on cost of 25%.