Please help me The following events occurred for Favata Company:a. Received $15,500 cash from owners and issued stock to them.b. Borrowed $12,500 cash from a bank and signed a note due later this year.c. Bought and received $1,350 of equipment on account.d. Purchased land for $23,000; paid $2,100 in cash and signed a long-term note for $20,900.e. Purchased $8,500 of equipment; paid $2,100 in cash and charged the rest on account.Required:For each of the events (a) through (e), perform transaction analysis and indicate the account, amount, and direction of the effect on theaccounting equation. (Enter any decreases to account balances with a minus sign.)EventabC.d.d.e.e.Assets===Liabilities+++Stockholders' Equity

Lets understand the basics.As per balance sheet or accounting equation, total assets are always…

Answered: The following events occurred for…

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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Malco Enterprises issued $10,000 of common stock when the company was started. In addition, Malco borrowed $36,000 from a local bank on July 1, Year 1. The note had a 6 percent annual interest rate and a one-year term to maturity. Malco Enterprises recognized $72,500 of revenue on account in Year 1 and $85,200 of revenue on account in Year 2. Cash collections of accounts receivable were $61,300 in Year 1 and $71,500 in Year 2. Malco paid $39,000 of other operating expenses in Year 1 and $45,000 of other operating expenses in Year 2. Malco repaid the loan and interest at the maturity date. What amount of interest expense would be reported on the Year 2 income statement? What amount of cash flows from operating activities would be reported on the Year 2 cash flow statement? What amount of assets would be reported on the December 31, Year 2, balance sheet?
Malco Enterprises issued $10,000 of common stock when the company was started. In addition, Malco borrowed $36,000 from a local bank on July 1, Year 1. The note had a 6 percent annual interest rate and a one-year term to maturity. Malco Enterprises recognized $72,500 of revenue on account in Year 1 and $85,200 of revenue on account in Year 2. Cash collections of accounts receivable were $61,300 in Year 1 and $71,500 in Year 2. Malco paid $39,000 of other operating expenses in Year 1 and $45,000 of other operating expenses in Year 2. Malco repaid the loan and interest at the maturity date. What amount of total liabilities would be reported on the December 31, Year 1, balance sheet? What amount of retained earnings would be reported on the December 31, Year 1, balance sheet? What amount of cash flow from financing activities would be reported on the Year 1 statement of cash flows?
Malco Enterprises issued $10,000 of common stock when the company was started. In addition, Malco borrowed $36,000 from a local bank on July 1, Year 1. The note had a 6 percent annual interest rate and a one-year term to maturity. Malco Enterprises recognized $72,500 of revenue on account in Year 1 and $85,200 of revenue on account in Year 2. Cash collections of accounts receivable were $61,300 in Year 1 and $71,500 in Year 2. Malco paid $39,000 of other operating expenses in Year 1 and $45,000 of other operating expenses in Year 2. Malco repaid the loan and interest at the maturity date. Organize the information in accounts under an accounting equation. What amount of net cash flow from operating activities would be reported on the Year 1 cash flow statement? What amount of interest expense would be reported on the Year 1 income statement?
Presented below are accounts of Cutie Company Additional: During the year, the owner made an additional investment of 20,000 and withdrawals of 50,000. Cutie company beginning capital is 617,600 and its net income for the year is 75,000. Instructions: Prepare the Statement of Financial Position in account form and report form and determine the amount of cash. Prepare the supporting notes.
Malco Enterprises issued $12,00 of common stock when the company was started. In addition, Malco borrowed $38,000 from a local bank on July 1, Year 1. The note had a 6 percent annual interest rate and a one-year term to maturity. Malco Enterprises recognized $74,700 of revenue on account in Year 1 and $87,200 of revenue on account in Year 2. Cash collections of accounts receivable were $63,300 in Year 1 and $73,500 in Year 2. Malco paid $40,800 of other operating expenses in Year 1 and $47,000 of other operating expenses in Year 2. Malco repaid the loan and interest at the maturity date. Based on this information given above, record the events in the accounting equation then answer the following questions. Enter any decreases to account balances with a minus sign. a. what amount of interest expense would Malco report on the Year 1 income statement? b. what amount of net cash flow from operating activites would Malco report on the Year 1 statement of cash flows? c. what amount of…
For each of the transactions in M2 - 9 (including the sample), write the journal entry using the format shown in this chapter (omit explanations). M2 - 9 (Sample) Borrowed $3,940 from a local bank on a note due in six months. Received $4, 630 cash from investors and issued common stock to them. Purchased $1,000 in equipment, paying $200 cash and promising the rest on a note due in one year. Paid $300 cash for supplies. Bought and received $700 of supplies on account. LO 2 - 3
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Suppose that the company has a balance sheet as follows at the beginning of the year. In that single year, the following transactions occur. One of the customers pays his $1,400 amount of debt by check. The company immediately pays its $1,200 amount of debt by endorsing these checks. After a while, another customer pays $900 cash for an outstanding debt. The company deposits $800 of this amount to its bank. Then, the company decides to pay one half of its debts via EFT(electronic funds transfer), and the other half of its debts by issuing its own checks. Lastly, the payee cashes these checks from the bank. Assuming that there are no more transactions throughout the year, what would be the total asset at the end of that year?
Bailey Delivery Company, Incorporated, was organized in 2021 in Wisconsin. The following transactions occurred during the year: a. Received cash from investors in exchange for 16,000 shares of stock (par value of $1.00 per share) with a market value of $8 per share. b. Purchased land in Wisconsin for $20,000, signing a one-year note (ignore interest). c. Bought two used delivery trucks for operating purposes at the start of the year at a cost of $15,000 each; paid $6,000 cash and signed a note due in three years for the rest (ignore interest). d. Paid $2,400 cash to a truck repair shop for a new motor for one of the trucks. (Increase the account you used to record the purchase of the trucks because the productive life of the truck has been improved) e. Sold one-fourth of the land for $5,000 to Pablo Development Corporation, which signed a six-month note. f. Stockholder Helen Bailey paid $29,500 cash for a vacant lot (land) in Canada for her personal use. 3. Prepare a classified balance…
Mark Jacobs established Jacobs Services in August by contributing $30,000 cash from his personal savings to the business in exchange for 100% of the common stock. Jacobs Services had the following transactions in September. September 1Purchased equipment with a price of $15,000 by paying $5,000 cash and signing a note for the remaining balance. September 2Paid $2,400 cash for a oneyear (or 12month) premium toward insurance. September 3 Paid September rent of $3,000. September 5 Purchased $4,000 of supplies on credit. September 8Performed serviced and received $1,000 cash. September 10 Billed clients $8,500 for services performed. September 12 Received an advance of $3,000 cash from a client for a project to be delivered in November. September 18 Collected $8,500 cash from clients toward their accounts billed on September 10. September 24 Paid $4,000 for the supplies purchased on September 5. September 30 Paid $100 cash for newspaper advertising to be aired in October.…
During the year, Penso Ltd received $50,000 from its customers, $5 000 for the sale of a motor vehicle and $20,000 for the issue of shares. It paid $27,000 to suppliers and employees, $3,000 for income tax and $50,000 for new machinery. In addition, it paid out $12,000 as loan repayments. Its cash balance at the commencement of the year was $19,000. What were the cash flows from financing activities? a. $8 000 b. $20,000 c. ($12,000) d. ($28,000) Which method can result in annual depreciation expense going up and down from period to period? a. Reducing balance b. Units of production c. Straight line d. Both Straight line and Reducing Balance During year ended 30 June 2019, Rugger Ltd had net sales of $256 000. Inventory at 1 July 2018 was $30 000, and at 30 June 2019 it was $23 000. Purchases were $115 000. What was the gross profit for year ended 30 June 2019? a. $12,000 b. $134,000 c. $141,000 d. $99,000 The Global Reporting Initiative sets out: a. guidelines on how to reduce carbon…
Mark Jacobs established Jacobs Services in August by contributing $30,000 cash from his personal savings to the business in exchange for 100% of the common stock. Jacobs Services had the following transactions in September. September 1Purchased equipment with a price of $15,000 by paying $5,000 cash and signing a note for the remaining balance. September 2Paid $2,400 cash for a oneyear (or 12month) premium toward insurance. September 3 Paid September rent of $3,000. September 5 Purchased $4,000 of supplies on credit. September 8Performed serviced and received $1,000 cash. September 10 Billed clients $8,500 for services performed. September 12 Received an advance of $3,000 cash from a client for a project to be delivered in November. September 18 Collected $8,500 cash from clients toward their accounts billed on September 10. September 24 Paid $4,000 for the supplies purchased on September 5. September 30 Paid $100 cash for newspaper advertising to be aired in October.…

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