Principles of Financial Accounting.
24th Edition
ISBN: 9781260158601
Author: Wild
Publisher: MCG
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Textbook Question
Chapter 1, Problem 11E
Identifying effects of transactions on the
The following table shows the effects of five transactions (1 through 5) on the assets, liabilities, and equity of Mulan’s Boutique
Identify the explanation from a through j below that best describes each transaction 1 through 5 above and enter it in the blank space in front of each numbered transaction
- a. The company purchased $1,000 of office supplies on credit.
- b. The company collected $1,900 cash from an account receivable.
- c. The company sold Land for $4,000 cash.
- d. The company paid $1,000 cash in dividends to shareholders
- e. The company purchased office supplies for $1,000 cash.
- f. The company purchased land for $4,000 cash.
- g. The company billed a client $1,900 for services provided
- h. The company paid $1,000 cash toward an account payable.
- i. The owner invested $1,900 cash in the business in exchange for its common stock.
- j. The company sold office supplies for $1,900 on credit.
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Assume Tata Company began operations on January 1 and completed the following transactions during its first month of operations. For each transaction, (a) analyze the transaction using the accounting equation, (b) record the transaction in journal entry form, and (c) post the entry using T-accounts to represent ledger accounts. Tata Company has the following (partial) chart of accounts—account numbers in parentheses: Cash (101); Accounts Receivable (106); Equipment (167); Accounts Payable (201); J. Tata, Capital (301); J. Tata, Withdrawals (302); Services Revenue (403); and Wages Expense (601).
2. Journalize the entries to record the transactions, and post to the eight selected accounts. Assume that the closing entry for revenues and expenses has been made and post net income of $1,196,500 to the retained earnings account. Refer to the Chart of Accounts for exact wording of account titles. When required, round your answers to the nearest dollar.
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JOURNAL
ACCOUNTING EQUATION
DATE
DESCRIPTION
POST. REF.
DEBIT
CREDIT
ASSETS
LIABILITIES
EQUITY
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Windsor, Inc. had the following transactions.
1.
Borrowed $ 6,184 from the bank by signing a note.
2.
Paid $ 3,092 cash for a computer.
3.
Purchased $ 557 of supplies on account.
(a)
Indicate what accounts are increased and decreased by each transaction.
Debit Analysis
Account Names
Credit Analysis
Account Names
1.
select an effect on a basic account type
enter a debit account title to record the first transaction
select an effect on a basic account type
enter a credit account title to record the first transaction
2.
select an effect on a basic account type
enter a debit account title to record the second transaction
select an effect on a basic account type
enter a credit account title to record the second transaction
3.
select an effect on a basic account type
enter a debit account title to record the third transaction
select an effect on a basic…
Chapter 1 Solutions
Principles of Financial Accounting.
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