Neva Nadal started a new business, Nadal Computing, and completed the following transactions during its first year of operations. a. Neva Nadal invested $90,000 cash and office equipment valued at $10,000 in the company in exchange for its common stock. b. The company purchased an office suite for $50,000 cash. c. The company purchased office equipment for $25.000 cash. d. The company purchased $1,200 of office supplies and $1,700 of office equipment on credit. e. The company paid a local newspaper $750 cash for printing an announcement of the office's opening. t. The company completed a financial plan for a client and billed that client $2,800 for the service. g. The company designed a financial plan for another client and immediately collected a $4,000 cash fee. h. The company paid $11,500 cash in dividends to the owner (sole shareholder). The company received $1,800 cash from the client described in transaction f. j. The company made a payment of $700 cash on the equipment purchased in transaction d. k. The company paid $2,500 cash for the office secretary's wages. Required 1. Create the following table similar to the one in Exhibit 1.9. Cash Assets Accounts + Office + Office + Office Receivable Supplies Equipment Suite Liabilities + Accounts + Common Payable Stock Problem 1-88 Analyzing effects of transactions A1 P1 Use additions and subtractions within the table to show the dollar effects of each transaction on indi- vidual items of the accounting equation. Show new balances after each transaction. 2. Determine the company's net income. Check (1) Ending balances Cash, 85,350, Expenses. $3.250, Accounts Payable $2,200 Equity Dividends + Revenues Expenses Not Income $3.550
Neva Nadal started a new business, Nadal Computing, and completed the following transactions during its first year of operations. a. Neva Nadal invested $90,000 cash and office equipment valued at $10,000 in the company in exchange for its common stock. b. The company purchased an office suite for $50,000 cash. c. The company purchased office equipment for $25.000 cash. d. The company purchased $1,200 of office supplies and $1,700 of office equipment on credit. e. The company paid a local newspaper $750 cash for printing an announcement of the office's opening. t. The company completed a financial plan for a client and billed that client $2,800 for the service. g. The company designed a financial plan for another client and immediately collected a $4,000 cash fee. h. The company paid $11,500 cash in dividends to the owner (sole shareholder). The company received $1,800 cash from the client described in transaction f. j. The company made a payment of $700 cash on the equipment purchased in transaction d. k. The company paid $2,500 cash for the office secretary's wages. Required 1. Create the following table similar to the one in Exhibit 1.9. Cash Assets Accounts + Office + Office + Office Receivable Supplies Equipment Suite Liabilities + Accounts + Common Payable Stock Problem 1-88 Analyzing effects of transactions A1 P1 Use additions and subtractions within the table to show the dollar effects of each transaction on indi- vidual items of the accounting equation. Show new balances after each transaction. 2. Determine the company's net income. Check (1) Ending balances Cash, 85,350, Expenses. $3.250, Accounts Payable $2,200 Equity Dividends + Revenues Expenses Not Income $3.550
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Neva Nadal started a new business, Nadal Computing, and completed the following transactions during its
first year of operations.
a. Neva Nadal invested $90,000 cash and office equipment valued at $10,000 in the company in
exchange for its common stock.
b. The company purchased an office suite for $50,000 cash.
c. The company purchased office equipment for $25,000 cash.
d. The company purchased $1,200 of office supplies and $1,700 of office equipment on credit.
e. The company paid a local newspaper $750 cash for printing an announcement of the office's opening.
1. The company completed a financial plan for a client and billed that client $2,800 for the service.
g. The company designed a financial plan for another client and immediately collected a $4,000 cash fee.
h. The company paid $11,500 cash in dividends to the owner (sole shareholder).
The company received $1,800 cash from the client described in transaction f.
j. The company made a payment of $700 cash on the equipment purchased in transaction d.
k. The company paid $2,500 cash for the office secretary's wages.
Required
1. Create the following table similar to the one in Exhibit 1.9.
Cash + Accounts
Receivable
Assets
Office
Office
Office
Supplies Equipment Suite
Liabilties +
Accounts + Common
Payable
Stock
Problem 1-88
Analyzing effects of
transactions
A1 P1
Use additions and subtractions within the table to show the dollar effects of each transaction on indi-
vidual items of the accounting equation. Show new balances after each transaction.
2. Determine the company's net income.
Check (1) Ending balances
Cash, 85,350, Expenses.
$3.250, Accounts Payable
$2,200
Equity
Dividends + Revenues
Expenses
Not Income $3.550
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