E2-4 (Algo) Determining Financial Statement Effects of Several Transactions LO2-3 The following events occurred for Johnson Company: a. Received investment of cash by organizers and distributed to them 1,070 shares of $1 par value common stock with a market price of $5 per share. b. Purchased $8,200 of equipment, paying $1,800 in cash and owing the rest on accounts payable to the manufacturer. c. Borrowed $5,000 cash from a bank. d. Loaned $600 to an employee who signed a note. e. Purchased $24,767 of land; paid $10,000 in cash and signed a note for the balance. Required: For each of the events (a) through (e), perform transaction analysis and indicate the account, amount, and direction of the effect (+ for increase and for decrease) on the accounting equation. Check that the accounting equation remains in balance after each transaction. (If no impact on accounting equation leave cells blank.) Event Assets Liabilities Stockholders' Equity a. b. C. d. e.
E2-4 (Algo) Determining Financial Statement Effects of Several Transactions LO2-3 The following events occurred for Johnson Company: a. Received investment of cash by organizers and distributed to them 1,070 shares of $1 par value common stock with a market price of $5 per share. b. Purchased $8,200 of equipment, paying $1,800 in cash and owing the rest on accounts payable to the manufacturer. c. Borrowed $5,000 cash from a bank. d. Loaned $600 to an employee who signed a note. e. Purchased $24,767 of land; paid $10,000 in cash and signed a note for the balance. Required: For each of the events (a) through (e), perform transaction analysis and indicate the account, amount, and direction of the effect (+ for increase and for decrease) on the accounting equation. Check that the accounting equation remains in balance after each transaction. (If no impact on accounting equation leave cells blank.) Event Assets Liabilities Stockholders' Equity a. b. C. d. e.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
This is a question from an accounting clas.
Transcribed Image Text:**E2-4 (Algo) Determining Financial Statement Effects of Several Transactions LO2-3**
The following events occurred for Johnson Company:
a. Received investment of cash by organizers and distributed to them 1,070 shares of $1 par value common stock with a market price of $5 per share.
b. Purchased $8,200 of equipment, paying $1,800 in cash and owing the rest on accounts payable to the manufacturer.
c. Borrowed $5,000 cash from a bank.
d. Loaned $600 to an employee who signed a note.
e. Purchased $24,767 of land; paid $10,000 in cash and signed a note for the balance.
**Required:**
For each of the events (a) through (e), perform transaction analysis and indicate the account, amount, and direction of the effect (+ for increase and - for decrease) on the accounting equation. Check that the accounting equation remains in balance after each transaction. **(If no impact on accounting equation leave cells blank.)**
| Event | Assets | = | Liabilities | + | Stockholders’ Equity |
|-------|--------|---|-------------|---|----------------------|
| a. | | | | | |
| b. | | | | | |
| c. | | | | | |
| d. | | | | | |
| e. | | | | | |
Remember to fill in each row with the appropriate changes to the assets, liabilities, and stockholders' equity based on the described transactions. For instance, in case (a), the company receives cash, impacting assets, and issues common stock, impacting stockholders' equity.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 2 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education