Ho Designs experienced the following events during Year 1, its first year of operation: 1. Started the business when it acquired $51,000 cash from the issue of common stock. 2. Paid $22,600 cash to purchase inventory. 3. Sold inventory costing $11,900 for $28,100 cash. 4. Physically counted inventory; had inventory of $7,100 on hand at the end of the accounting period. Required a. Record the events in the T-accounts provided. b. Prepare an income statement and balance sheet.
Ho Designs experienced the following events during Year 1, its first year of operation: 1. Started the business when it acquired $51,000 cash from the issue of common stock. 2. Paid $22,600 cash to purchase inventory. 3. Sold inventory costing $11,900 for $28,100 cash. 4. Physically counted inventory; had inventory of $7,100 on hand at the end of the accounting period. Required a. Record the events in the T-accounts provided. b. Prepare an income statement and balance sheet.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Ho Designs experienced the following events during Year 1, its first year of operation:
1. Started the business when it acquired $51,000 cash from the issue of common stock.
2. Paid $22,600 cash to purchase inventory.
3. Sold inventory costing $11,900 for $28,100 cash.
4. Physically counted inventory; had inventory of $7,100 on hand at the end of the accounting period.
Required
a. Record the events in the T-accounts provided.
b. Prepare an income statement and balance sheet.
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