Survey of Accounting (Accounting I)
8th Edition
ISBN: 9781305961883
Author: Carl Warren
Publisher: Cengage Learning
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Chapter 2, Problem 2.10E
Effects of transactions on
On Time Delivery Service had the following selected transactions during November:
1. Received cash from issuance of common stock, $75,000.
2. Paid rent for November, $5000.
3. Paid advertising expense, $3,000.
4. Received cash for providing delivery services, $34,500.
5. Borrowed $10,000 from Second National Bank to finance its operations.
6. Purchased a delivery van for cash, $25,000.
7. Paid interest on note from Second National Bank, $75.
8. Paid salaries and wages for November, $10,000.
9. Paid dividends, $2,000.
Indicate the effect of each transaction on the accounting equation by listing the numbers identifying the transactions, (1) through (9), in a vertical column, and inserting at the right of each number the appropriate letter from he following list:
a. Increase in an asset, decrease in another asset.
h. Increase in an asset, increase in a liability.
c. Increase in an asset, increase in stockholders’ equity.
d. Decrease in an asset, decrease in a liability.
e. Decrease in an asset, decrease in
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Weave Company received a bank statement for the month of August. The bank statement showed the following information: Balance 1 August $68,326 Deposits 45,300 Cheques processed (63,222) Service charges (50) Monthly deposit into saving account directly (26,120) Deducted by bank from account (780) Balance, 31st August $49,574 Weave Co’s general ledger account had a balance of $78,304 at the end of August. (i) Deposits shown in the general ledger account but not in the bank amounting to $8,200; (ii) all cheques written by the company were processed by the bank except for those totaling $8,420; (iii) A $2,000 cheque to a supplier correctly recorded by the bank but was incorrectly recorded by the company as $200 credit to cash. Required:
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2. Prepare the necessary journal entries at the end of August to adjust the general ledger cash account.
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Chapter 2 Solutions
Survey of Accounting (Accounting I)
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