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Analysis Component: Littlechild Enterprises' assets are financed 76% by debt. What does this mean? As part of your answer, include an explanation of how the 76% was calculated. (Round your answer to the nearest whole number.) Assets result from a combination of debt and equity financing (A = L+ E). Littlechild Enterprises' total assets of resulted from incurring in liabilities. x 100 = 76 %

Analysis Component: Littlechild Enterprises' assets are financed 76% by debt. What does this mean? As part of your answer, include an explanation of how the 76% was calculated. (Round your answer to the nearest whole number.) Assets result from a combination of debt and equity financing (A = L+ E). Littlechild Enterprises' total assets of resulted from incurring in liabilities. x 100 = 76 %

FINANCIAL ACCOUNTING
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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Analysis Component: Littlechild Enterprises' assets are financed 76% by debt. What does this mean? As part of your answer, include an explanation of how the 76% was calculated. (Round your answer to the nearest whole number.) Assets result from a combination of debt and equity financing (A = L+E). Littlechild Enterprises' total assets of resulted from incurring in liabilities. 76 % 100 =
Transcribed Image Text:Analysis Component: Littlechild Enterprises' assets are financed 76% by debt. What does this mean? As part of your answer, include an explanation of how the 76% was calculated. (Round your answer to the nearest whole number.) Assets result from a combination of debt and equity financing (A = L+E). Littlechild Enterprises' total assets of resulted from incurring in liabilities. 76 % 100 =
George Littlechild started a new kitchen and bath design business called Littlechild Enterprises. The following activities occurred during its first month of operations, March 2020: a. Littlechild invested $160,000 cash and office equipment valued at $20,000 in the business. b. Purchased a small building for $600,000 to be used as an office. Paid $100,000 in cash and signed a note payable promising to pay the balance over several years. c. Purchased $3,000 of office supplies for cash. d. Purchased $72,000 of office equipment on credit. e. Littlechild made reservations at a hotel hosting a kitchen and bath design conference in August 2020. He will send a $1,000 deposit on July 1, 2020. f. Completed a project on credit and billed the client $5,200 for the work. g. Paid a local online newspaper $3,500 for an announcement that the office had opened. h. Completed a project for a client and collected $4,000 cash. i. Made a $4,000 payment on the equipment purchased in (d). j. Received $2,500 from the client described in (f). k. Paid $7,000 cash for the office secretary's wages. I. Littlechild withdrew $3,600 cash from the company bank account to pay personal living expenses.
Transcribed Image Text:George Littlechild started a new kitchen and bath design business called Littlechild Enterprises. The following activities occurred during its first month of operations, March 2020: a. Littlechild invested $160,000 cash and office equipment valued at $20,000 in the business. b. Purchased a small building for $600,000 to be used as an office. Paid $100,000 in cash and signed a note payable promising to pay the balance over several years. c. Purchased $3,000 of office supplies for cash. d. Purchased $72,000 of office equipment on credit. e. Littlechild made reservations at a hotel hosting a kitchen and bath design conference in August 2020. He will send a $1,000 deposit on July 1, 2020. f. Completed a project on credit and billed the client $5,200 for the work. g. Paid a local online newspaper $3,500 for an announcement that the office had opened. h. Completed a project for a client and collected $4,000 cash. i. Made a $4,000 payment on the equipment purchased in (d). j. Received $2,500 from the client described in (f). k. Paid $7,000 cash for the office secretary's wages. I. Littlechild withdrew $3,600 cash from the company bank account to pay personal living expenses.
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