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Asset Source Transactions 1. Began operations by acquiring $16,000 of cash from the issue of common stock. 2. Performed services and collected cash of $900. 3. Collected $4,900 of cash in advance for services to be provided over the next 12 months. 4. Provided $12,200 of services on account. 5. Purchased supplies of $470 on account.

Asset Source Transactions 1. Began operations by acquiring $16,000 of cash from the issue of common stock. 2. Performed services and collected cash of $900. 3. Collected $4,900 of cash in advance for services to be provided over the next 12 months. 4. Provided $12,200 of services on account. 5. Purchased supplies of $470 on account.

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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The following accounting events apply to Mary's Designs for Year 1: **Asset Source Transactions** 1. Began operations by acquiring $16,000 of cash from the issue of common stock. 2. Performed services and collected cash of $900. 3. Collected $4,900 of cash in advance for services to be provided over the next 12 months. 4. Provided $12,200 of services on account. 5. Purchased supplies of $470 on account. **Asset Exchange Transactions** 6. Purchased $4,200 of land for cash. 7. Collected $7,100 of cash from accounts receivable. 8. Purchased $420 of supplies with cash. 9. Paid $3,700 for one year’s rent in advance. **Asset Use Transactions** 10. Paid $2,800 cash for salaries of employees. 11. Paid a cash dividend of $1,900 to the stockholders. 12. Paid off $470 of the accounts payable with cash. **Claims Exchange Transactions** 13. Placed an advertisement in the local newspaper for $150 on account. 14. Incurred utility expense of $115 on account. **Adjusting Entries** 15. Recognized $3,675 of revenue for performing services. The collection of cash for these services occurred in a prior transaction. (See Event 3.) 16. Recorded $1,480 of accrued salary expense at the end of Year 1.
Transcribed Image Text:The following accounting events apply to Mary's Designs for Year 1: **Asset Source Transactions** 1. Began operations by acquiring $16,000 of cash from the issue of common stock. 2. Performed services and collected cash of $900. 3. Collected $4,900 of cash in advance for services to be provided over the next 12 months. 4. Provided $12,200 of services on account. 5. Purchased supplies of $470 on account. **Asset Exchange Transactions** 6. Purchased $4,200 of land for cash. 7. Collected $7,100 of cash from accounts receivable. 8. Purchased $420 of supplies with cash. 9. Paid $3,700 for one year’s rent in advance. **Asset Use Transactions** 10. Paid $2,800 cash for salaries of employees. 11. Paid a cash dividend of $1,900 to the stockholders. 12. Paid off $470 of the accounts payable with cash. **Claims Exchange Transactions** 13. Placed an advertisement in the local newspaper for $150 on account. 14. Incurred utility expense of $115 on account. **Adjusting Entries** 15. Recognized $3,675 of revenue for performing services. The collection of cash for these services occurred in a prior transaction. (See Event 3.) 16. Recorded $1,480 of accrued salary expense at the end of Year 1.
The image depicts several T-accounts used in accounting to track different financial elements. Each T-account includes columns for recording debits and credits. The accounts listed are: 1. Land - The account for Land includes spaces for the Beginning Balance (Beg. Bal) and the Ending Balance (End. Bal). - Columns are present for recording transactions that increase or decrease the balance. 2. Accounts Payable - This account tracks amounts owed by the company to creditors. - It also includes Beginning and Ending Balances with columns for debits and credits. 3. Unearned Revenue - Used to record revenue received before services are rendered or goods are delivered. - Includes columns for transactions affecting the account balance. 4. Salaries Payable - This account represents salaries owed to employees. - Similar to others, it has sections for Beginning and Ending Balances, debits, and credits. 5. Common Stock - Tracks the issued shares of stock and their value. - Includes areas for transaction entries and balance updates. 6. Dividends - Tracks dividends declared and paid to shareholders. - Contains sections for Beginning and Ending Balances, along with transaction entries. Each T-account serves as a tool for managing financial data, ensuring a clear understanding of how transactions impact different areas of an organization's finances.
Transcribed Image Text:The image depicts several T-accounts used in accounting to track different financial elements. Each T-account includes columns for recording debits and credits. The accounts listed are: 1. Land - The account for Land includes spaces for the Beginning Balance (Beg. Bal) and the Ending Balance (End. Bal). - Columns are present for recording transactions that increase or decrease the balance. 2. Accounts Payable - This account tracks amounts owed by the company to creditors. - It also includes Beginning and Ending Balances with columns for debits and credits. 3. Unearned Revenue - Used to record revenue received before services are rendered or goods are delivered. - Includes columns for transactions affecting the account balance. 4. Salaries Payable - This account represents salaries owed to employees. - Similar to others, it has sections for Beginning and Ending Balances, debits, and credits. 5. Common Stock - Tracks the issued shares of stock and their value. - Includes areas for transaction entries and balance updates. 6. Dividends - Tracks dividends declared and paid to shareholders. - Contains sections for Beginning and Ending Balances, along with transaction entries. Each T-account serves as a tool for managing financial data, ensuring a clear understanding of how transactions impact different areas of an organization's finances.
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