Question 2 Sualihu Ltd had the following selected transactions: 1. Sualihu Ltd invested AED4,000 in the business in exchange for ordinary shares. 2. Paid office rent of AED1,100 3. Performed consulting services and billed a client AED5,200. 4. Declared and paid a AED700 cash dividend. Required to: [a] Indicate the effect each transaction has on the accounting equation [Assets-Liabilities + Equity] using plus and minus signs. [b] Journalize each transaction.
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- Gulf Cement, Inc. reports the following assets and liabilities, Compute the totals that would appear in the corporation's basic accounting equation (Assets = Liabilities + Stockholders' Equity (Capital Stock)). Cash...Asset.. OMR 37,000 Assets e Yi abilities + Equity- Accounts Payable....liabi libies OMR 15,000 30 800 Supplies....A seps. OMR 1, 800 Loan Payable. ibiliies OMR 9,000 Inventory....AScts. OMR 12,000Assume that the total assets, liabilities, Equity of the firm are OMR 40000, OMR 10000 and OMR 30000 respectively.The company sold OMR 3000 furniture for its customer and received notes receivables for OMR 4500. What is the effect of the above transaction on different elements of financial position of the company? a. Assets of the company increase by OMR 1500 and capital of the company increase by OMR 1500 b. Assets of the company decrease by OMR 3000 and capital of the company decrease by OMR 3000 c. Assets of the company increase by OMR 4500 and capital of the company increase by OMR 4500 d. None of the given optionsHelp me
- Exercise 2: If you know the following accounting information related to Rajhi Bank (Figures are in SR'000): 1. Beginning balance of: a. Common stock, par value SR100; 50,000 shares are authorized, issued paid. b. Statutory reserve, SR3,000. c. General reserve, SRS,000. d. Retained earnings, SR11,000. 2. Net income, SR180,000. 3. Transfer from R/E to statutory reserve, SRI,500. to general reserve, SR2,000. 4. Zakat, SR800. Required: 1. Prepare the statement of shareholders equity changes. 2. If the board of directors decides to split the outstanding SR100 par value common stock and issues 5 shares of SR20 par value common stock for each old share previously outstanding, then prepare the statement of shareholders' equity changes and explain the difference between the two statement.The following information was drawn from the balance sheets of two companies. Company East Liabilities + 88,000 171,000 Equity 104,000 429,000 Assets 192,000 600,000 West Required a. Compute the debt-to-assets ratio to measure the level of financial risk of both companies. b. Compare the two ratios computed in requirement a to identify which company has the higher level of financial risk. Complete this question by entering your answers in the tabs below. Required A Required B Compute the debt-to-assets ratio to measure the level of financial risk of both companies. (Round your answers to 1 decimal place.) Debt to Assets Company Ratio East West %Chapter 5, page 344 and 349: EA12. 5.3 Using the following Balance Sheet summary information, calculate for the two years presented: A. working capital B. current ratio 12/31/2018 12/31/2019 $76,000 48,000 Current assets $295,000 Current liabilities 163,500 After computing liquidity ratios, comment on the performance of an entity using acceptable standards of liquidity performance
- BE1-4 Use the accounting equation to answer each of the following questions.(a) The liabilities of Alli Company Ltd. are £90,000. Share capital—ordinary is £150,000; dividends are £40,000; revenues, £450,000; and expenses, £320,000. What is the amount of Alli Company Ltd.’s total assets?The average liabilities, average stockholders' equity, and average total assets are as follows: 1. Determine the following ratios for both companies, rounding ratios and percentagesto one decimal place: a. Return on total assets b. Return on stockholders' equity c. Times interest earned d. Ratio of total liabilities to stockholders' equity 2. Based on the information in (1), analyze and compare the two companies'solvency and profitability. Comprehensive profitability and solvency analysis Marriott International, Inc., and Hyatt Hotels Corporation are two major owners and managers of lodging and resort properties in the United States. Abstracted income statement information for the two companies is as follows for a recent year (in millions): Balance sheet information is as follows:MC.03.083.Algo Wu Systems has the following balance sheet. Assume that all current assets are used in operations. How much net operating working capital does the firm have? Cash Accounts receivable Inventory Current assets Net fixed assets Total assets O a. $400 b. $1,770 O c. $2,200 d. $470 e. $830 $ 70 Accounts payable 720 Accruals 510 $1,300 1,000 Notes payable Current liabilities Long-term debt Common equity Retained earnings $2,300 Total liab. & equity $ 250 220 430 Question 3 of 40 $ 900 640 260 500 $2,300
- EA16. Discuss how each of the following transactions for Watson, International, will affect assets, liabilities, and stockholders’ equity, and prove the company’s accounts will still be in balance. A. An investor invests an additional $25,000 into a company receiving stock in exchange.B. Services are performed for customers for a total of $4,500. Sixty percent was paid in cash, and the remaining customers asked to be billed.C. An electric bill was received for $35. Payment is due in thirty days. D. Part-time workers earned $750 and were paid.E. The electric bill in “C” is paid.Your answer: (Answer B, C, D, and E by referring to the answer example for A)A. (as an example, the answer for A. is shown below)Cash will increase $25,000, so total assets will increase $25,000.Common stock will increase $25,000, increasing total stockholders’ equity $25,000.There is an equal increase on each side of the equation.There is an equal decrease on each side of the equation.5. Suppose Mr. Chen lends P500,000 cash to the entity. At the same, the entity uses part of the money to repay the amount owed to a creditor and holds the remaining amount of P400,000 in the bank account. Which of the following effects on the accounting equation is correct?Select one: a.Assets increase by P500,000 and liabilities increase by P500,000 b.Assets decrease by P100,000 and liabilities increase by P500,000 c.Assets increase by P400,000 and liabilities increase by P400,000 d.Assets increase by P400,000 and liabilities decrease by P500,000BE1-4 Use the accounting equation to answer each of the following questions.(a) The liabilities of Alli Company Ltd. are £90,000. Share capital—ordinary is £150,000; dividends are £40,000; revenues, £450,000; and expenses, £320,000. What is the amount of Alli Company Ltd.’s total assets?(b) The total assets of Planke Company Ltd. are £57,000. Share capital—ordinary is £23,000; dividends are £7,000; revenues, £50,000; and expenses, £35,000. What is the amount of the company’s total liabilities?