Required information [The following information applies to the questions displayed below.] Laser Delivery Services, Incorporated (LDS), was incorporated January 1. The following transactions occurred during the year. a. Received $34,000 cash from the company's founders in exchange for common stock. b. Purchased land for $12,500, signing a two-year note (ignore interest). c. Bought two used delivery trucks at the start of the year at a cost of $10,000 each; paid $2,000 cash and signed a note due in three years for $18,000 (ignore interest). d. Paid $1,500 cash to a truck repair shop for a new motor, which increased the cost of one of the trucks. e. Stockholder Jonah Lee paid $290,000 cash for a house for his personal use. 4. Prepare a classified balance sheet for Laser Delivery Services at December 31. Include Retained Earnings on the balance sheet even though the account has a zero balance. LASER DELIVERY SERVICES, INCORPORATED Balance Sheet

Required information [The following information applies to the questions displayed below.] Laser Delivery Services, Incorporated (LDS), was incorporated January 1. The following transactions occurred during the year. a. Received $34,000 cash from the company's founders in exchange for common stock. b. Purchased land for $12,500, signing a two-year note (ignore interest). c. Bought two used delivery trucks at the start of the year at a cost of $10,000 each; paid $2,000 cash and signed a note due in three years for $18,000 (ignore interest). d. Paid $1,500 cash to a truck repair shop for a new motor, which increased the cost of one of the trucks. e. Stockholder Jonah Lee paid $290,000 cash for a house for his personal use. 4. Prepare a classified balance sheet for Laser Delivery Services at December 31. Include Retained Earnings on the balance sheet even though the account has a zero balance. LASER DELIVERY SERVICES, INCORPORATED Balance Sheet

SWFT Essntl Tax Individ/Bus Entities 2020

23rd Edition

ISBN:9780357391266

Author:Nellen

Publisher:Nellen

Chapter18: Comparative Forms Of Doing Business

Section: Chapter Questions

Problem 1BD

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2. January 1, John Smith formed a corporation. Record the following transactions that took place during the year ended December 31, 1990 on the attached sheet. The corporation records transactions on an accrual basis. Record contribution of $25,000 cash for Capital Stock. Leased a building at a cost of $10,000 per year on 1/1/90. Purchased inventory for resale at a cost of $20,000 payable June 15, 1991. Sold one-fourth of the inventory for $5,000 cash and $5,000 on account. Collected $2,500 on account. Paid salaries as follows: Gross Pay $954 158 Federal withholding FICA withholding Net Pay 46 $750 Paid taxes withheld and company's share of FIICA ($46) to the government. Transaction for the Year Credits Debits Cash Accounts Receivable Inventory Accounts Payable Accrued Payroll Taxes Capital Stock Retained Earning (Net Income) Sales Cost of Sales Salaries Payroll Taxes Lease Expense Income Taxes Total Transactions
Lone Star Overnight, Inc. (LSO), was incorporated January 1. The following transactions occurred during the year: Received $39211 cash from the company's shareholder Amy Fowler in exchange for common stock. Bought a used delivery truck at the start of the year at a cost of $19054 paid $2,000 cash and signed a note due in three years for rest (ignore interest). Stockholder Amy Fowler paid $11758 cash for a car for her personal use. After recording these transactions, LSO's total assets will be $
Georgia Corporation incorporated on September 2, current year. The company engaged in the following transactions during its first month of operations. Sept. 2 Issued capital stock in exchange for $1,17e,e00 cash. Sept. 4 Purchased land and a building for $1,080,000. The value of the land was $240,eee, and the value of the building was $840,000. The company paid $120,000 cash and issued a note payable for the balance. Sept. 12 Purchased office supplies for $600 on account. The supplies will last for several months. Sept. 19 Billed clients $216,000 on account. Sept. 29 Recorded and paid salary expense of $72, e00. Sept. 30 Received $132,0ee from clients billed on September 19. A partial list of the account titles used by the company includes the following. Cash Accounts Receivable Office Supplies Land Building Notes Payable Accounts Payable Capital Stock Client Revenue Salary Expense a. Prepare journal entries for the above transactions. b. Post each entry to the appropriate ledger…
Prepare general journal entries for the following transactions, identifying each transaction by letter: (a) Gnu Company issued 5,000 shares of 1 par common stock to the Prendergas law firm as partial payment of fees incurred to incorporate the business. Gnu was short of cash, so Prendergas agreed to accept 10,000 cash and the shares of common stock in full settlement of its bill for 55,000. (b) Gnu issued 50,000 shares of 1 par common stock in exchange for a parcel of land for building a shopping plaza. (The list price for the land was 400,000; a similar parcel in the same area sold last week for 380,000. During the past month, the price at which Gnus common stock has traded on the open market has ranged from 5 to 12 per share. Two trades occurred yesterday at 7 and 10 per share.) (c) Gnu purchased 10,000 shares of 1 par value common treasury stock for 70,000. (This is the only treasury stock that Gnu holds.) (d) Gnu sold 4,000 shares of common treasury stock for 32,000. (e) Gnu sold 5,000 shares of common treasury stock for 30,000.
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Sept. 1 The Corporation issued 20,000 shares of capital stock to Elizabeth Carver in exchange for her investment of Birr 50,000 cash which she had saved over a period of years. Sept. 10 purchased a small office building located on a large lot for a total price of Birr 182,000, of which Birr 106,000 was applicable to the land and Birr76, 000 to the building. A cash payment of Birr 36,500 was made and a note payable was issued for the balance of the purchase price. Sept. 15 purchased a microcomputer system from Computer Stores Inc., for Birr 1,680 cash. Sept. 19 Purchased office furniture, filing cabinets and a typewriter from Davidson Office Supply Company at a cost of Birr 3,960. A cash down payment of Birr 720 was made, the balance to be paid in three equal installments due September 28, October 28, and November 28. The purchase was on open account and did not require signing of a promissory note. Sept. 26 A Birr 140 monitor in the microcomputer system purchased on September 15…
The following information applies to the questions displayed below.] Ken Young and Kim Sherwood organized Reader Direct as a corporation; each contributed $49,000 cash to start the business and received 4,000 shares of stock. The store completed its first year of operations on December 31, 2020. On that date, the following financial items for the year were determined: cash on hand and in the bank, $47,500; amounts due from customers from sales of books, $26,900; equipment, $48,000; amounts owed to publishers for books purchased, $8,000; one-year notes payable to a local bank for $2,850. No dividends were declared or paid to the stockholders during the year. E1-4 (Static) Part 2 2. Using the retained earnings equation and an opening balance of $0, work backwards to compute the amount of net income for the year ended December 31, 2020. Net Income Ending RE + Dividends - Beginning RE = = +
Ken Young and Kim Sherwood organized Reader Direct as a corporation; each contributed $52,675 cash to start the business and received 4,300 shares. The store completed its first year of operations on December 31, 2020. On that date, the following financial items for the year were determined: cash on hand and in the bank, $49,150, amounts due from customers from sales of books, $28,850, property and equipment, $54,750, amounts owed to publishers for books purchased, $8,900; one-year note payable to a local bank for $4,200. No dividends were declared or paid to the shareholders during the year. Required: 1. Complete the balance sheet at December 31, 2020: Total assets Assets READER DIRECT Balance Sheet At December 31, 2020 $ Total liabilities Liabilities Shareholders' equity Total shareholders equity 0 Total llabilities & shareholders' equity $ 0 0
Bennett Griffin and Chula Garza organized Cole Valley Book Store as a corporation; each contributed $71,600 cash to start the business and received 4,700 shares of common stock. The store completed its first year of operations on December 31, current year. On that date, the following financial items for the year were determined: December 31, current year, cash on hand and in the bank, $69,650; December 31, current year, amounts due from customers from sales of books, $39,500; unused portion of store and office equipment, $73,500: December 31, current year, amounts owed to publishers for books purchased, $12,600; one-year note payable to a local bank for $3,800. No dividends were declared or paid to the stockholders during the year. Required: 1. Complete the following balance sheet as of the end of the current year. Some information has been given below. 2. What was the amount of net income for the year? (Hint: Use the retained earnings equation (Beginning Retained Earnings + Net Income…
Bennett Griffin and Chula Garza organized Cole Valley Book Store as a corporation; each contributed $71,600 cash to start the business and received 5,800 shares of common stock. The store completed its first year of operations on December 31, current year. On that date, the following financial items for the year were determined: December 31, current year, cash on hand and in the bank, $70,150; December 31, current year, amounts due from customers from sales of books, $41,000; unused portion of store and office equipment, $78,000; December 31, current year, amounts owed to publishers for books purchased, $13,800; one-year note payable to a local bank for $3,200. No dividends were declared or paid to the stockholders during the year. Required: 1. Complete the following balance sheet as of the end of the current year. Some information has been given below. 2. What was the amount of net income for the year? (Hint: Use the retained earnings equation [Beginning Retained Earnings + Net Income…
Dristell Inc. had the following activities during the year (all transactions are for cash unless stated otherwise): A building with a book value of $400,000 was sold for $500,000. Additional common stock was issued for $160,000. Dristell purchased its own common stock as treasury stock at a cost of $75,000. Land was acquired by issuing a 6%, 10-year, $750,000 note payable to the seller. A dividend of $40,000 was paid to shareholders. An investment in Fleet Corp.’s common stock was made for $120,000. New equipment was purchased for $65,000. A $90,000 note payable issued three years ago was paid in full. A loan for $100,000 was made to one of Dristell’s suppliers. The supplier plans to repay Dristell this amount plus 10% interest within 18 months. Required:Calculate net cash flows from investing activities. (List cash outflows and any decrease in cash as negative amounts.)