Required information E2-16 (Algo) Analyzing the Effects of Transactions Using T-Accounts, Preparing a Balance Sheet, and Evaluating the Current Ratio over Time as a Bank Loan Officer LO2-4, 2-5 [The following information applies to the questions displayed below.] Bailey Delivery Company, Inc., was organized in 2018 in Wisconsin. The following transactions occurred during the year: a. Received cash from investors in exchange for 10,000 shares of stock (par value of $1.00 per share) with a market value of $10 per share. b. Purchased land in Wisconsin for $25,000, signing a one-year note (ignore interest). c. Bought two used delivery trucks for operating purposes at the start of the year at a cost of $14,000 each; paid $3,000 cash and signed a note due in three years for the rest (ignore interest). d. Paid $2,300 cash to a truck repair shop for a new motor for one of the trucks. (Increase the account you used to record the purchase of the trucks because the productive life of the truck has been improved) e. Sold one-fourth of the land for $6,250 to Pablo Development Corporation, which signed a six-month note. f. Stockholder Helen Bailey paid $29,200 cash for a vacant lot (land) in Canada for her personal use. E2-16 Part 2 2. Prepare a trial balance at December 31, 2018. BAILEY DELIVERY COMPANY, INC. Trial Balance Common stock Additional paid-in capital Cash Land Totals Long-term notes payable Short-term notes payable Equipment Short-term note receivable $ Debit Credit $ 10,000 0 $ 10,000
Required information E2-16 (Algo) Analyzing the Effects of Transactions Using T-Accounts, Preparing a Balance Sheet, and Evaluating the Current Ratio over Time as a Bank Loan Officer LO2-4, 2-5 [The following information applies to the questions displayed below.] Bailey Delivery Company, Inc., was organized in 2018 in Wisconsin. The following transactions occurred during the year: a. Received cash from investors in exchange for 10,000 shares of stock (par value of $1.00 per share) with a market value of $10 per share. b. Purchased land in Wisconsin for $25,000, signing a one-year note (ignore interest). c. Bought two used delivery trucks for operating purposes at the start of the year at a cost of $14,000 each; paid $3,000 cash and signed a note due in three years for the rest (ignore interest). d. Paid $2,300 cash to a truck repair shop for a new motor for one of the trucks. (Increase the account you used to record the purchase of the trucks because the productive life of the truck has been improved) e. Sold one-fourth of the land for $6,250 to Pablo Development Corporation, which signed a six-month note. f. Stockholder Helen Bailey paid $29,200 cash for a vacant lot (land) in Canada for her personal use. E2-16 Part 2 2. Prepare a trial balance at December 31, 2018. BAILEY DELIVERY COMPANY, INC. Trial Balance Common stock Additional paid-in capital Cash Land Totals Long-term notes payable Short-term notes payable Equipment Short-term note receivable $ Debit Credit $ 10,000 0 $ 10,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Required information
E2-16 (Algo) Analyzing the Effects of Transactions Using T-Accounts, Preparing a Balance Sheet, and
Evaluating the Current Ratio over Time as a Bank Loan Officer LO2-4, 2-5
[The following information applies to the questions displayed below.]
Bailey Delivery Company, Inc., was organized in 2018 in Wisconsin. The following transactions occurred during the year:
E2-16 Part 2
Cash
Land
a. Received cash from investors in exchange for 10,000 shares of stock (par value of $1.00 per share) with a market
value of $10 per share.
b. Purchased land in Wisconsin for $25,000, signing a one-year note (ignore interest).
c. Bought two used delivery trucks for operating purposes at the start of the year at a cost of $14,000 each; paid
$3,000 cash and signed a note due in three years for the rest (ignore interest).
d. Paid $2,300 cash to a truck repair shop for a new motor for one of the trucks. (Increase the account you used to
record the purchase of the trucks because the productive life of the truck has been improved)
e. Sold one-fourth of the land for $6,250 to Pablo Development Corporation, which signed a six-month note.
f. Stockholder Helen Bailey paid $29,200 cash for a vacant lot (land) in Canada for her personal use.
2. Prepare a trial balance at December 31, 2018.
Common stock
Additional paid-in capital
BAILEY DELIVERY COMPANY, INC.
Trial Balance
Long-term notes payable
Short-term notes payable
Totals
Equipment
Short-term note receivable
$
Debit
Credit
$ 10,000
0 $ 10,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ff0a4e976-3597-4de8-93c3-f330d3be0980%2Fc55340ce-1568-4a6f-b4a0-ecf5182a34f9%2Fnf92mct_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Required information
E2-16 (Algo) Analyzing the Effects of Transactions Using T-Accounts, Preparing a Balance Sheet, and
Evaluating the Current Ratio over Time as a Bank Loan Officer LO2-4, 2-5
[The following information applies to the questions displayed below.]
Bailey Delivery Company, Inc., was organized in 2018 in Wisconsin. The following transactions occurred during the year:
E2-16 Part 2
Cash
Land
a. Received cash from investors in exchange for 10,000 shares of stock (par value of $1.00 per share) with a market
value of $10 per share.
b. Purchased land in Wisconsin for $25,000, signing a one-year note (ignore interest).
c. Bought two used delivery trucks for operating purposes at the start of the year at a cost of $14,000 each; paid
$3,000 cash and signed a note due in three years for the rest (ignore interest).
d. Paid $2,300 cash to a truck repair shop for a new motor for one of the trucks. (Increase the account you used to
record the purchase of the trucks because the productive life of the truck has been improved)
e. Sold one-fourth of the land for $6,250 to Pablo Development Corporation, which signed a six-month note.
f. Stockholder Helen Bailey paid $29,200 cash for a vacant lot (land) in Canada for her personal use.
2. Prepare a trial balance at December 31, 2018.
Common stock
Additional paid-in capital
BAILEY DELIVERY COMPANY, INC.
Trial Balance
Long-term notes payable
Short-term notes payable
Totals
Equipment
Short-term note receivable
$
Debit
Credit
$ 10,000
0 $ 10,000
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