At the beginning of Year 2, Better Corporation's accounting records had the following general ledger accounts and balances. Event Assets _=Liabilities +___ Stockholders' Equity Notes Cash Payable Beginning Balance 01/01/Year 2 20,000 30,000 13,000 Better Corporation completed the following transactions during Year 2: BETTER CORPORATION Accounting Equation Land Common Stock 8,000 1. Purchased land for $10,000 cash. 2. Acquired $35,000 cash from the issue of common stock. 3. Received $74,000 cash for providing services to customers. 4. Paid cash operating expenses of $41,000. 5. Borrowed $20,000 cash from the bank. 6. Paid a $10,000 cash dividend to the stockholders. 7. Determined that the market value of the land purchased in event 1 is $45,000. Retained Earnings 29,000 Accounts Titles for Retained Earnings Required a. Record the transactions in the appropriate general ledger accounts. Record the amounts of revenue, expense, and dividends in the Retained Earnings column. Provide the appropriate titles for these accounts in the last column of the table. b. As of December 31, Year 2, determine the total amount of assets, llabilities, and stockholders' equity and present this Information in the form of an accounting equation. c. What is the amount of total assets, llabilities, and stockholders' equity as of January 1, Year 3?
At the beginning of Year 2, Better Corporation's accounting records had the following general ledger accounts and balances. Event Assets _=Liabilities +___ Stockholders' Equity Notes Cash Payable Beginning Balance 01/01/Year 2 20,000 30,000 13,000 Better Corporation completed the following transactions during Year 2: BETTER CORPORATION Accounting Equation Land Common Stock 8,000 1. Purchased land for $10,000 cash. 2. Acquired $35,000 cash from the issue of common stock. 3. Received $74,000 cash for providing services to customers. 4. Paid cash operating expenses of $41,000. 5. Borrowed $20,000 cash from the bank. 6. Paid a $10,000 cash dividend to the stockholders. 7. Determined that the market value of the land purchased in event 1 is $45,000. Retained Earnings 29,000 Accounts Titles for Retained Earnings Required a. Record the transactions in the appropriate general ledger accounts. Record the amounts of revenue, expense, and dividends in the Retained Earnings column. Provide the appropriate titles for these accounts in the last column of the table. b. As of December 31, Year 2, determine the total amount of assets, llabilities, and stockholders' equity and present this Information in the form of an accounting equation. c. What is the amount of total assets, llabilities, and stockholders' equity as of January 1, Year 3?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
#15
Transcribed Image Text:At the beginning of Year 2, Better Corporation's accounting records had the following general ledger accounts and
balances.
Event
= Liabilities +
Notes
Payable
Beginning Balance
01/01/Year 2
20,000
13,000
Better Corporation completed the following transactions during Year 2:
1. Purchased land for $10,000 cash.
2. Acquired $35,000 cash from the issue of common stock.
3. Received $74,000 cash for providing services to customers.
Event
Balance
1/1/Year 2
Totals
Cash
4. Paid cash operating expenses of $41,000.
5. Borrowed $20,000 cash from the bank.
6. Paid a $10,000 cash dividend to the stockholders.
7. Determined that the market value of the land purchased in event 1 is $45,000.
1.
2.
3.
4.
5.
6.
7.
Required
a. Record the transactions in the appropriate general ledger accounts. Record the amounts of revenue, expense, and
dividends in the Retained Earnings column. Provide the appropriate titles for these accounts in the last column of the
table.
b. As of December 31, Year 2, determine the total amount of assets, llabilities, and stockholders' equity and present this
Information in the form of an accounting equation.
c. What is the amount of total assets, abilities, and stockholders' equity as of January 1, Year 3?
Complete this question by entering your answers in the tabs below.
Required Required Required
A
B
с
Assets
Cash
Assets
Record the transactions in the appropriate general ledger accounts. Record the amounts of revenue, expense, and
dividends in the Retained Earnings column. Provide the appropriate titles for these accounts in the last column of
the table. (Enter any decreases to account balances with a minus sign. Not all cells require entry.)
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20,000+
+
Land
+
+
30,000
+
+
+
BETTER CORPORATION
Accounting Equation
BETTER CORPORATION
Accounting Equation for Year 2
Land
30,000 = 13,000 +
|||||||
= Liabilities + Stockholders' Equity
Notes Common Retained
+
Payable Stock
Earnings
29,000
8,000 +
=
=
=
20,000+ 30,000 =
+
+
Accounts Titles for
Stockholders' Equity Retained Earnings
+
Common
Stock
8,000
13,000+
< Required A
+
+
+
+
8,000 +
Retained
Earnings
29,000
29,000
Accounts Titles for
Retained Earnings
Required B >
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