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FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Record each transaction in a journal entry . Explanations are not required.

Transcribed Image Text:**Transaction Analysis for Educational Purposes**
Here's a detailed analysis of a series of financial transactions:
a. **Capital Infusion:**
- Received $500,000 in cash and issued common stock.
- Opened a new checking account at Atlanta National Bank and deposited the cash received from stockholders.
b. **Asset Acquisition:**
- Paid $200,000 in cash and issued a $400,000, 10-year, 5% notes payable to acquire land with an existing building.
- Asset market values: Land: $100,000; Building: $500,000.
c. **Store Fixtures Purchase:**
- Paid $75,000 for new store fixtures.
d. **Office Equipment Purchase:**
- Paid $45,000 for office equipment.
e. **Office Supplies Purchase:**
- Paid $600 for office supplies.
f. **Insurance Policy:**
- Paid $3,600 for a two-year insurance policy.
g. **Inventory Purchase:**
- Purchased $425,000 worth of appliances from Long Appliance Manufacturers on account.
h. **Petty Cash Fund:**
- Established a petty cash fund of $150.
i. **Credit Sale:**
- Sold $215,000 worth of appliances to Bill Contractors, with terms n/30 (cost: $86,000).
j. **Promissory Note:**
- Sold $150,000 worth of appliances to Down Contracting (cost: $65,000), receiving a 6-month, 8% note.
k. **Credit Card Sales:**
- Recorded $80,000 in credit card sales (cost: $35,000), net of a 2% processor fee.
l. **Accounts Receivable Collection:**
- Received full payment from Bill Contractors.
m. **Additional Inventory Purchase:**
- Purchased $650,000 worth of appliances from Long Appliance Manufacturers on account.
n. **Account Payment:**
- Made a $300,000 payment on account to Long Appliance Manufacturers.
o. **Cash Sale:**
- Sold appliances to Home Builders for $350,000 in cash (cost: $175,000).
p. **Note Receivable Collection:**
- Received full payment on the maturity date from Down Contracting for the note.
q. **Additional Sales via Promissory Note:**
- Sold $265,000 worth of appliances
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