A newly founded business performed in their first days of operations, the six transactions that you can find below. The business was founded on the 20th of July, by a young entrepreneur, Mr Grey, who wanted to provide typing, copying, and printing services to the university students in his home city: a) 20/07/2019: In exchange for his investment of $200,000 cash, the business issued to Mr Grey 1,000 shares of capital stock. b) 21/07/2019: Purchased a small building and land for $450,000, paying $165,000 cash and signing a note payable for the balance. The building $210,000 and the land was considered to be worth $240,000. c) 22/07/2019: Purchased office equipment for $30,000 from Office Furniture Co. Paid $17,000 cash and agreed to pay the balance within 60 days. d) 26/7/2019: Purchased from Auto Ltd. a motorcycle on credit for $3,400 to be used for making deliveries to customers. Mr Grey agreed to make payment to Auto Ltd. within 10 days. e) 27/7/2019 Signed a note payable due in six months, for borrowing $30,000 from a bank. f) 30/7/2019: Paid in full the account payable to Auto Ltd. Questions: A. Record the above transaction to the Journal. B. Post the recording to the T accounts, using the following Account Titles: - Cash - Office Equipment - Notes Payable - Land - Delivery Vehicles - Accounts Payable - Buildings - Capital Stock C. Prepare a trial balance at July 31 by using the form provided to you in the theory's example (create the heading and the columns accordingly).
A newly founded business performed in their first days of operations, the six transactions that you can find below. The business was founded on the 20th of July, by a young entrepreneur, Mr Grey, who wanted to provide typing, copying, and printing services to the university students in his home city: a) 20/07/2019: In exchange for his investment of $200,000 cash, the business issued to Mr Grey 1,000 shares of capital stock. b) 21/07/2019: Purchased a small building and land for $450,000, paying $165,000 cash and signing a note payable for the balance. The building $210,000 and the land was considered to be worth $240,000. c) 22/07/2019: Purchased office equipment for $30,000 from Office Furniture Co. Paid $17,000 cash and agreed to pay the balance within 60 days. d) 26/7/2019: Purchased from Auto Ltd. a motorcycle on credit for $3,400 to be used for making deliveries to customers. Mr Grey agreed to make payment to Auto Ltd. within 10 days. e) 27/7/2019 Signed a note payable due in six months, for borrowing $30,000 from a bank. f) 30/7/2019: Paid in full the account payable to Auto Ltd. Questions: A. Record the above transaction to the Journal. B. Post the recording to the T accounts, using the following Account Titles: - Cash - Office Equipment - Notes Payable - Land - Delivery Vehicles - Accounts Payable - Buildings - Capital Stock C. Prepare a trial balance at July 31 by using the form provided to you in the theory's example (create the heading and the columns accordingly).
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:1. A newly founded business performed in their first days of operations, the six transactions
that you can find below. The business was founded on the 20th of July, by a young
entrepreneur, Mr Grey, who wanted to provide typing, copying, and printing services to
the university students in his home city:
a) 20/07/2019: In exchange for his investment of $200,000 cash, the business issued
to Mr Grey 1,000 shares of capital stock.
b) 21/07/2019: Purchased a small building and land for $450,000, paying $165,000
cash and signing a note payable for the balance. The building $210,000 and the land
was considered to be worth $240,000.
c) 22/07/2019: Purchased office equipment for $30,000 from Office Furniture Co.
Paid $17,000 cash and agreed to pay the balance within 60 days.
d) 26/7/2019: Purchased from Auto Ltd. a motorcycle on credit for $3,400 to be used
for making deliveries to customers. Mr Grey agreed to make payment to Auto Ltd.
within 10 days.
e) 27/7/2019 Signed a note payable due in six months, for borrowing $30,000 from a
bank.
f) 30/7/2019: Paid in full the account payable to Auto Ltd.
Questions:
A. Record the above transaction to the Journal.
B. Post the recording to the Taccounts, using the following Account Titles:
- Cash
- Office Equipment
- Notes Payable
- Land
- Delivery Vehicles
- Accounts Payable
- Buildings
- Capital Stock
C. Prepare a trial balance at July 31 by using the form provided to you in the theory's
example (create the heading and the columns accordingly).
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