Required information [The following information applies to the questions displayed below.] On January 2, Summers Company received a machine that the company had ordered with an invoice price of $85,000. Freight costs of $1,000 were paid by the vendor per the sales agreement. The company exchanged the following on January 2 to acquire the machine: a. Issued 2,000 shares of Summers Company common stock, par value $1 (market value, $3.50 per share). b. Signed a note payable for $60,000 with an 11.5 percent interest rate (principal plus interest are due April 1 of the current year). c. The balance of the invoice price was on account with the vendor, to be paid in cash by January 12. On January 3, Summers Company paid $2,400 cash for installation costs to prepare the machine for use. On January 12, Summers Company paid the balance due on its accounts payable to the vendor. Required: 2. Record the purchase on January 2, the installation costs on January 3, and the subsequent payment on January 12. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.

Required information [The following information applies to the questions displayed below.] On January 2, Summers Company received a machine that the company had ordered with an invoice price of $85,000. Freight costs of $1,000 were paid by the vendor per the sales agreement. The company exchanged the following on January 2 to acquire the machine: a. Issued 2,000 shares of Summers Company common stock, par value $1 (market value, $3.50 per share). b. Signed a note payable for $60,000 with an 11.5 percent interest rate (principal plus interest are due April 1 of the current year). c. The balance of the invoice price was on account with the vendor, to be paid in cash by January 12. On January 3, Summers Company paid $2,400 cash for installation costs to prepare the machine for use. On January 12, Summers Company paid the balance due on its accounts payable to the vendor. Required: 2. Record the purchase on January 2, the installation costs on January 3, and the subsequent payment on January 12. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.

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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Q7
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