Event Balance 1/1/Year 2 Assets Cash Land 15,000 25,000 Accounting Equation Liabilities Notes Payable 12,500 + Better Corp, completed the following transactions during Year 2 4. Paid cash operating expenses of $41,500. 5. Borrowed $15,000 cash from the bank. 1. Purchased land for $7,500 cash. 2. Acquired $30,000 cash from the issue of common stock. 3. Received $69,000 cash for providing services to customers. Stockholders' Equity Retained Earnings 20,000 Common Stock 7,500 6. Paid a $7,500 cash dividend to the stockholders. 7. Determined that the market value of the land purchased in event 1 is $40,000. Accounting Titles for Retained Earnings Required a. Record the transactions in the accounting equation for Year 2. 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, liabilities, and stockholders' equity and present this information in the form of an accounting equation. c. What is the amount of total assets, liabilities, and stockholders' equity as of January 1, Year 3?

Event Balance 1/1/Year 2 Assets Cash Land 15,000 25,000 Accounting Equation Liabilities Notes Payable 12,500 + Better Corp, completed the following transactions during Year 2 4. Paid cash operating expenses of $41,500. 5. Borrowed $15,000 cash from the bank. 1. Purchased land for $7,500 cash. 2. Acquired $30,000 cash from the issue of common stock. 3. Received $69,000 cash for providing services to customers. Stockholders' Equity Retained Earnings 20,000 Common Stock 7,500 6. Paid a $7,500 cash dividend to the stockholders. 7. Determined that the market value of the land purchased in event 1 is $40,000. Accounting Titles for Retained Earnings Required a. Record the transactions in the accounting equation for Year 2. 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, liabilities, and stockholders' equity and present this information in the form of an accounting equation. c. What is the amount of total assets, liabilities, and stockholders' equity as of January 1, Year 3?

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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