Financial Accounting
9th Edition
ISBN: 9781259222139
Author: Robert Libby, Patricia Libby, Frank Hodge Ch
Publisher: McGraw-Hill Education
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Textbook Question
Chapter 2, Problem 2.4E
Determining Financial Statement Effects of Several Transactions
The following events occurred for Johnson Company:
- a. Received investment of cash by organizers and distributed to them 1,000 shares of SI par value common stock with a market price of $40 per share.
- b. Purchased $15,000 of equipment, paying $3,000 in cash and owing the rest on accounts payable to the manufacturer.
- c. Borrowed $10,000 cash from a bank.
- d. Loaned $800 to an employee who signed a note.
- e. Purchased $13,000 of land: paid $4,000 in cash and signed a mortgage note for the balance.
Required:
For each of the events (a) through (e), perform transaction analysis and indicate the account, amount, and direction of the effect (+ for increase and − for decrease) on the
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Analyzing Transactions Using the Financial Statement Effects Template
Following
are selected transactions of Mogg Company. Record the effects of each using the financial statement effects template.
1. Shareholders contribute $15,000 cash to the business in exchange for common stock.
2. Employees earn $750 in wages that have not been paid at period-end.
3. Inventory of $4,500 is purchased on credit.
4. The inventory purchased in transaction 3 is sold for $6,750 on credit.
5. The company collected the $6,750 owed to it per transaction 4.
6. Equipment is purchased for $7,500 cash.
7. Depreciation of $1,500 is recorded on the equipment from transaction 6.
8. The Supplies account had a $3,800 balance at the beginning of this period; a physical count at period-end shows that $1,200 of supplies are still available. No supplies were purchased during this period.
9. The company paid $15,000 cash toward the principal on a note payable; also, $750 cash is paid to cover this note's interest…
At the beginning of October, Ingram Company's assets totaled $288.300 and abilities totaled $72,300. During October the following summarized transactions occurred.
Additional shares of stock were sold for $24,3000 cash
A building costing $114,600 was purchased using $12.300 cash and by signing $102,300 long term note payable.
Short-term investments costing $11,100 were purchased using cash
$12.300 was paid to an employee as a loan, the employee signed a sox-month note in exchange for the loan.
How much are Ingram's total assets at the end of October?
Multiple Choice
$299,400
$414.900
$300,600
$402,600
ook
rint
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The following events occurred for Johnson Company:
a. Received investment of cash by organizers and distributed to them 1,200 shares of $1 par value common stock with a market
price of $30 per share.
b. Leased $8,400 of equipment, paying $1,900 in cash and signing a long-term right-of-use lease for the rest owed.
c. Borrowed $14,000 cash from a bank.
d. Loaned $800 to an employee who signed a note due in six months.
e. Purchased $16,909 of land; paid $9,000 in cash and signed a note for the balance.
Required:
For each of the events (a) through (e), perform transaction analysis and indicate the account and amount. Check that the accounting
equation remains in balance after each transaction.
Note: Enter decreases to an element of the balance sheet with a minus sign. If no impact on accounting equation leave cells
blank.
Event
a.
a.
b.
b.
C
C.
d
d.
e
e.
Cash
Long-term investments
Cash
Cash
Cash
Note receivable
Land
Cash
Assets
Liabilities
+
+
+
+
+
+
+
+
+
Stockholders'…
Chapter 2 Solutions
Financial Accounting
Ch. 2 - Prob. 1QCh. 2 - Define the following: a. Asset b. Current asset c....Ch. 2 - Explain what the following accounting terms mean:...Ch. 2 - Why are accounting assumptions necessary?Ch. 2 - For accounting purposes, what is an account?...Ch. 2 - What is the fundamental accounting model?Ch. 2 - Prob. 7QCh. 2 - Explain what debit and credit mean.Ch. 2 - Prob. 9QCh. 2 - Prob. 10Q
Ch. 2 - Prob. 11QCh. 2 - Prob. 12QCh. 2 - How is the current ratio computed and interpreted?Ch. 2 - Prob. 14QCh. 2 - Prob. 1MCQCh. 2 - Which of the following is not an asset? a....Ch. 2 - Total liabilities on a balance sheet at the end of...Ch. 2 - The dual effects concept can best be described as...Ch. 2 - The T-account is a tool commonly used for...Ch. 2 - Prob. 6MCQCh. 2 - The Cash T-account has a beginning balance of...Ch. 2 - Prob. 8MCQCh. 2 - At the end of a recent year, The Gap, Inc.,...Ch. 2 - Prob. 10MCQCh. 2 - Matching Definitions with Terms Match each...Ch. 2 - Matching Definitions with Terms Match each...Ch. 2 - Identifying Events as Accounting Transactions...Ch. 2 - Classifying Accounts on a Balance Sheet The...Ch. 2 - Determining Financial Statement Effects of Several...Ch. 2 - Prob. 2.6MECh. 2 - Prob. 2.7MECh. 2 - Prob. 2.8MECh. 2 - Prob. 2.9MECh. 2 - Prob. 2.10MECh. 2 - Prob. 2.11MECh. 2 - Computing and Interpreting the Current Ratio...Ch. 2 - Identifying Transactions as Investing or Financing...Ch. 2 - Matching Definitions with Terms Match each...Ch. 2 - Identifying Account Titles The following are...Ch. 2 - Classifying Accounts and Their Usual Balances As...Ch. 2 - Determining Financial Statement Effects of Several...Ch. 2 - Determining Financial Statement Effects of Several...Ch. 2 - Recording Investing and Financing Activities Refer...Ch. 2 - Prob. 2.7ECh. 2 - Recording Investing and Financing Activities...Ch. 2 - Analyzing the Effects of Transactions In...Ch. 2 - Analyzing the Effects of Transactions In...Ch. 2 - Prob. 2.11ECh. 2 - Inferring Investing and Financing Transactions and...Ch. 2 - Recording Journal Entries Nathanson Corporation...Ch. 2 - Prob. 2.14ECh. 2 - Analyzing the Effects of Transactions Using...Ch. 2 - Prob. 2.16ECh. 2 - Prob. 2.17ECh. 2 - Prob. 2.18ECh. 2 - Inferring Typical Investing and Financing...Ch. 2 - Prob. 2.20ECh. 2 - Identifying the Investing and Financing Activities...Ch. 2 - Prob. 2.22ECh. 2 - Identifying Accounts on a Classified Balance Sheet...Ch. 2 - Determining Financial Statement Effects of Various...Ch. 2 - Prob. 2.3PCh. 2 - Prob. 2.4PCh. 2 - Prob. 2.5PCh. 2 - Prob. 2.6PCh. 2 - Prob. 2.1APCh. 2 - Determining Financial Statement Effects of Various...Ch. 2 - Recording Transactions in T-Accounts, Preparing...Ch. 2 - Prob. 2.4APCh. 2 - Accounting for the Establishment of a New Business...Ch. 2 - Prob. 2.1CPCh. 2 - Prob. 2.2CPCh. 2 - Prob. 2.3CPCh. 2 - Prob. 2.4CPCh. 2 - Prob. 2.5CPCh. 2 - Prob. 2.6CPCh. 2 - Prob. 2.7CPCh. 2 - Prob. 2.8CP
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