Financial Accounting
15th Edition
ISBN: 9781337272124
Author: Carl Warren, James M. Reeve, Jonathan Duchac
Publisher: Cengage Learning
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Question
Chapter 1, Problem 4PA
1.
To determine
Indicate the effect of each given transaction of Company HMR on the
b)
To determine
Prepare the financial statements for Company HMR for the month ended July 31, 2019.
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On July 1, 2019, Pat Glenn established Half Moon Realty. Pat completed the following transactions during the month of July:
a. Opened a business bank account with a deposit of $30,000 from personal funds.
b. Purchased office supplies on account, $3,010.
c. Paid creditor on account, $1,900.
d. Earned sales commissions, receiving cash, $30,690.
On July 1, 2019, Pat Glenn established Half Moon Realty. Pat completed the following transactions during the month of July:a. Opened a business bank account with a deposit of $25,000 from personal funds.b. Purchased office supplies on account, $1,850.
c. Paid creditor on account, $1,200.d. Earned sales commissions, receiving cash, $41,500.e. Paid rent on office and equipment for the month, $3,600.f. Withdrew cash for personal use, $4,000.g. Paid automobile expenses (including rental charge) for the month, $3,050, and miscellaneous expenses, $1,600.h. Paid office salaries, $5,000.i. Determined that the cost of supplies on hand was $950; therefore, the cost of supplies used was $900.
Prepare journal entries for the following transactions that took place during the year, 2021:
a. Borrowed $50,000 cash on July 1, 2020, signing a two-year, 10% note payable.
b. Purchased Land for $54,000 cash on July 1, 2020.
c. Earned $50,000 in revenue, including $23,000 in cash and the rest on credit.
d. Collected accounts receivable, $15,000.
e. Paid wages to employees, $22,000.
f. Purchased supplies of $4,500 on account.
g. Paid accounts payable, $4,500.
h. Recorded depreciation of $2,300 for the year.
i. Recorded estimated bad debt expense of $500.
j. Determined that only $1,500 of the supplies purchased in f. were on hand at the end of the year.
Chapter 1 Solutions
Financial Accounting
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