Financial Accounting (5th Edition) (What's New in Accounting)
5th Edition
ISBN: 9780134727790
Author: Robert Kemp, Jeffrey Waybright
Publisher: PEARSON
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Textbook Question
Chapter 1, Problem 1CP
This problem is the first problem in a sequence that begins an accounting cycle. The cycle is continued in Chapter 2 and completed in Chapter 3.
Adam Mazella recently left his job to open his own gym equipment repair business Adam took all of the money he had in his personal savings account and used it to open Fitness Equipment Doctor, Inc., on March 1, 2018 Presented next are the transactions for the first month of operations for Fitness Equipment Doctor, Inc.:
| March 1 | Adam invested $22,000 cash and a used truck with a fair market value of $13,000 in the business in exchange for the company's common stock. |
| 3 | Paid $3,600 cash to purchase equipment. |
| 7 | Purchased $900 of supplies on account. |
| 12 | Performed services for cash customers and received $850. |
| 15 | Incurred and paid salaries of $620 to the office reception. |
| 16 | Sold the company truck for $13,000. |
| 18 | Signed a note payable for $35,800 to purchase a new truck. |
| 21 | Performed $3,200 of services on account for a local hotel chain. |
| 27 | Paid $150 of the amount owed from the purchase of supplies on March 7. |
| 30 | Received $1, 900 on account from credit customers. |
| 31 | Received the utility bill for the month of March, $250. The bill is not due until April 15. |
| 31 | Paid $1,500 dividends to me shareholder, Adam Mazella. |
Requirements
- 1. Enter the transactions for Fitness Equipment Doctor, Inc., for the month of March into the
expanded accounting equation . Calculate the ending balances at March 31. - 2. Prepare the income statement for Fitness Equipment Doctor, Inc., for the first month of operations.
- 3. Prepare the statement of
retained earnings for Fitness Equipment Doctor, Inc., for the first month of operations. - 4. Prepare the
balance sheet for Fitness Equipment Doctor, Inc., at March 31. - 5. Did Adam make a wise decision leaving his job to start Fitness Equipment Doctor, inc.?
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Chapter 1 Solutions
Financial Accounting (5th Edition) (What's New in Accounting)
Ch. 1 - The text states that accounting is the "language...Ch. 1 - Would you describe accounting as primarily a...Ch. 1 - Prob. 3DQCh. 1 - What are some reasons why accounting has adopted...Ch. 1 - What are some of the uses of financial statements?Ch. 1 - Prob. 6DQCh. 1 - Prob. 7DQCh. 1 - How is the accounting equation affected by each of...Ch. 1 - In what order should the financial statements be...Ch. 1 - Which financial statement would be most useful to...
Ch. 1 - Prob. 1SCCh. 1 - Prob. 2SCCh. 1 - Which accounting principle specifically states...Ch. 1 - Wave Rider is famous for custom skateboards. At...Ch. 1 - Assume that Wave Rider sold skateboards to a...Ch. 1 - Assume that Wave Rider sold skateboards to another...Ch. 1 - Assume that Wave Rider paid expenses totaling...Ch. 1 - Consider the overall effects of the transactions...Ch. 1 - The balance sheet reports a. a businesss financial...Ch. 1 - The income statement reports a. a business's...Ch. 1 - Prob. 11SCCh. 1 - Prob. 12SCCh. 1 - Accounting principles (Learning Objective 4) 5-10...Ch. 1 - Accounting principles (Learning Objective 4) 5-10...Ch. 1 - Prob. 3SECh. 1 - Basic accounting equation (Learning Objective 5)...Ch. 1 - Prob. 5SECh. 1 - Prob. 6SECh. 1 - Prob. 7SECh. 1 - Entering transactions in the accounting equation...Ch. 1 - Prob. 9SECh. 1 - Prob. 10SECh. 1 - Entering transactions in the accounting equation...Ch. 1 - Transaction analysis (Learning Objective 5) 5-10...Ch. 1 - Transaction analysis (Learning Objective 5) 5-10...Ch. 1 - Prob. 14SECh. 1 - Basic accounting equation (Learning Objective 5)...Ch. 1 - Basic accounting equation (Learning Objective 5)...Ch. 1 - Prob. 17AECh. 1 - Using the accounting equation to determine net...Ch. 1 - Transaction analysis (Learning Objective 5) 15-20...Ch. 1 - Types of business organizations and balance sheet...Ch. 1 - Types of accounts and income statement preparation...Ch. 1 - Using the accounting equation to determine net...Ch. 1 - Basic accounting equation (Learning Objective 5)...Ch. 1 - Prob. 24BECh. 1 - Prob. 25BECh. 1 - Prob. 26BECh. 1 - Transaction analysis (Learning Objective 5) 15-20...Ch. 1 - Prob. 28BECh. 1 - Prob. 29BECh. 1 - Prob. 30BECh. 1 - Transaction analysis and the calculation of net...Ch. 1 - Prob. 32APCh. 1 - A Preparing the income statement, statement of...Ch. 1 - Preparing the income statement and balance sheet;...Ch. 1 - Prob. 35APCh. 1 - Transaction analysis and the calculation of net...Ch. 1 - Prob. 37BPCh. 1 - Prob. 38BPCh. 1 - Preparing the income statement and balance sheet;...Ch. 1 - Prob. 40BPCh. 1 - Prob. 1CECh. 1 - This problem is the first problem in a sequence...Ch. 1 - Prob. 1CFSAPCh. 1 - Prob. 1EIACh. 1 - Prob. 2EIACh. 1 - Prob. 1FACh. 1 - Industry Analysis Purpose: To help you understand...Ch. 1 - Prob. 1SBACh. 1 - Prob. 1WC
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