The Marchetti Soup Company entered into the following transactions during the month of June: (1) purchased inventory on account for $160,000 (assume Marchetti uses a perpetual inventory system); (2) paid $43,000 in salaries to employees for work performed during the month; (3) sold inventory on account to customers for $215,000 that had a cost of $126,000; (4) collected $195,000 in cash from credit customers; and (5) paid on account to suppliers of inventory $140,000. Analyze each transaction and show the effect of each on the accounting equation for a corporation. Note: Amounts to be deducted should be indicated by a minus sign. Enter the net change on the accounting equation. Assets (1) (2) = + (3) = + Liabilities Paid-in capital + Retained Earnings + + + + (4) + + (5) = + +

The Marchetti Soup Company entered into the following transactions during the month of June: (1) purchased inventory on account for $160,000 (assume Marchetti uses a perpetual inventory system); (2) paid $43,000 in salaries to employees for work performed during the month; (3) sold inventory on account to customers for $215,000 that had a cost of $126,000; (4) collected $195,000 in cash from credit customers; and (5) paid on account to suppliers of inventory $140,000. Analyze each transaction and show the effect of each on the accounting equation for a corporation. Note: Amounts to be deducted should be indicated by a minus sign. Enter the net change on the accounting equation. Assets (1) (2) = + (3) = + Liabilities Paid-in capital + Retained Earnings + + + + (4) + + (5) = + +

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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