Analyze transactions (a)-(e) to determine their effects on the accounting equation. (Enter any decreases to account balances with minus sign. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).)
Analyze transactions (a)-(e) to determine their effects on the accounting equation. (Enter any decreases to account balances with minus sign. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Subject:
![PA2-3 (Algo) Recording Transactions (in a Journal and T-Accounts); Preparing and Interpreting the
Balance Sheet [LO 2-1, LO 2-2, LO 2-3, LO 2-4, LO 2-5]
[The following information applies to the questions displayed below.]
Southern Allen Interiors Incorporated is a leading manufacturer and retailer of home furnishings in the United States and
abroad. The following is adapted from Southern Allen's June 30, 2019, trial balance. (The amounts shown represent
millions of dollars.)
Accounts Payable
Accounts Receivable
Cash
Common Stock
Equipment
Inventory
Notes Payable (long-term)
Notes Payable (short-term)
Prepaid Rent
Retained Earnings
Salaries and Wages Payable
Software
$ 112
26
132
22
355
168
215
2
24
373
36
55
Assume that the following events occurred in the following quarter.
a. Paid $50 cash for additional inventory.
b. Issued additional shares of common stock for $15 in cash.
c. Purchased equipment for $250; paid $120 in cash and signed a note to pay the remaining $130 in two years.
d. Signed a short-term note to borrow $11 cash.
e. Conducted negotiations to purchase a sawmill, which is expected to cost $30.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fc7fe5a73-45e4-4166-8ba1-50e355550dfc%2F1e66cf58-a8c9-44be-b626-11489a059aad%2Fju30d9_processed.jpeg&w=3840&q=75)
Transcribed Image Text:PA2-3 (Algo) Recording Transactions (in a Journal and T-Accounts); Preparing and Interpreting the
Balance Sheet [LO 2-1, LO 2-2, LO 2-3, LO 2-4, LO 2-5]
[The following information applies to the questions displayed below.]
Southern Allen Interiors Incorporated is a leading manufacturer and retailer of home furnishings in the United States and
abroad. The following is adapted from Southern Allen's June 30, 2019, trial balance. (The amounts shown represent
millions of dollars.)
Accounts Payable
Accounts Receivable
Cash
Common Stock
Equipment
Inventory
Notes Payable (long-term)
Notes Payable (short-term)
Prepaid Rent
Retained Earnings
Salaries and Wages Payable
Software
$ 112
26
132
22
355
168
215
2
24
373
36
55
Assume that the following events occurred in the following quarter.
a. Paid $50 cash for additional inventory.
b. Issued additional shares of common stock for $15 in cash.
c. Purchased equipment for $250; paid $120 in cash and signed a note to pay the remaining $130 in two years.
d. Signed a short-term note to borrow $11 cash.
e. Conducted negotiations to purchase a sawmill, which is expected to cost $30.
Transcribed Image Text:PA2-3 (Algo) Part 2
2. Analyze transactions (a)-(e) to determine their effects on the accounting equation. (Enter any decreases to account balances with
a minus sign. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).)
a.
b.
C.
d.
0
Cash
Assets
Inventory
Equipment
Liabilities
Notes Payable
(short-term)
Notes Payable
(long-term)
Stockholders
Equity
Common
Stock
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