Harrigan Service Company, Inc., was incorporated by lan Harrigan and five other managers.The following activities occurred during the year:1. Received $71,400 cash from the managers; each was issued 1,190 shares.2. Purchased equipment for use in the business at a cost of $50,000; one-fourth was paid incash and the company signed a note for the balance (due in six months).3. Signed an agreement with a cleaning service to pay it $690 per week for cleaning thecorporate offices, beginning next week.4. Ian Harrigan borrowed $19,500 for personal use from a local bank, signing a one-yearnote. Required:1. Create T-accounts for the following accounts: Cash, Equipment, Note Payable, and Contributed Capital. Beginning balances arezero. For each of the above transactions, record its effects in the appropriate T-accounts. Include referencing and totals for each T-account.Beg. bal.a.End. bal.Beg. bal.End. bal.Cash0Assets71,40071,400Note Payable0= LiablitiesBeg. bal.End. bal.Beg. bal.End. bal.Equipment02. Using the balances in the T-accounts, enter the following amounts for the accounting equation.+ Shareholders' EquityContributed Capital0

T-account :— It is the general ledger account which is prepared to post journal entries. It is the…

Required: 1. Create T-accounts for the following accounts: Cash, Equipment, Note Payable, and Contributed Capital. Beginning balances are zero. For each of the above transactions, record its effects in the appropriate T-accounts. Include referencing and totals for each T- account. Beg. bal. a. End. bal. Beg. bal. End. bal. Cash 0 Assets 71,400 71,400 Note Payable 0 =Liablities Beg. bal. End. bal. Beg. bal. End. bal. Equipment 0 2. Using the balances in the T-accounts, enter the following amounts for the accounting equation. + Shareholders' Equity Contributed Capital 0

Required: 1. Create T-accounts for the following accounts: Cash, Equipment, Note Payable, and Contributed Capital. Beginning balances are zero. For each of the above transactions, record its effects in the appropriate T-accounts. Include referencing and totals for each T- account. Beg. bal. a. End. bal. Beg. bal. End. bal. Cash 0 Assets 71,400 71,400 Note Payable 0 =Liablities Beg. bal. End. bal. Beg. bal. End. bal. Equipment 0 2. Using the balances in the T-accounts, enter the following amounts for the accounting equation. + Shareholders' Equity Contributed Capital 0

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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Concept explainers

Bookkeeping

Bookkeeping is the process of recording the financial transactions of a company on a regular basis. With the process of bookkeeping, companies can track important financial information that helps management in making crucial decisions.

Question

Harrigan Service Company, Inc., was incorporated by lan Harrigan and five other managers.
The following activities occurred during the year:
1. Received $71,400 cash from the managers; each was issued 1,190 shares.
2. Purchased equipment for use in the business at a cost of $50,000; one-fourth was paid in
cash and the company signed a note for the balance (due in six months).
3. Signed an agreement with a cleaning service to pay it $690 per week for cleaning the
corporate offices, beginning next week.
4. Ian Harrigan borrowed $19,500 for personal use from a local bank, signing a one-year
note.

Required:
1. Create T-accounts for the following accounts: Cash, Equipment, Note Payable, and Contributed Capital. Beginning balances are
zero. For each of the above transactions, record its effects in the appropriate T-accounts. Include referencing and totals for each T-
account.
Beg. bal.
a.
End. bal.
Beg. bal.
End. bal.
Cash
0
Assets
71,400
71,400
Note Payable
0
= Liablities
Beg. bal.
End. bal.
Beg. bal.
End. bal.
Equipment
0
2. Using the balances in the T-accounts, enter the following amounts for the accounting equation.
+ Shareholders' Equity
Contributed Capital
0

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