Session%2004 - Solutions for Session 04 Assignments: P2-7A...

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P2-7A Given: a. Analyze each transaction in the accounting equation worksheet and describe the underlying exchange that resulted in the entry. 1. The owners started a business by contributing $3,000 in exchange for common stock. 2. The firm borrowed $50,000 by signing a 5-year note. 3. The company purchased $5,000 worth of supplies (for future use) on account. 4. Service revenues of $2,500 were earned on account. 5. Service revenues of $10,000 were earned & paid with cash. 6. The company purchased $8,000 worth of supplies (for future use) with cash. 7. The company received a $1,200 cash payment on accounts receivable from transaction 4. 8. The company paid $3,400 of accounts payable owed from transaction 3. = + Cash A/R Supplies A/P Notes payable + 1. 3,000 2. 50,000 50,000 Common Stock 3. 5,000 5,000 4. 2,500 5. 10,000 6. (8,000) 8,000 7. 1,200 (1,200) 8. (3,400) (3,400) 9. (3,100) 10. (500) 3,000 2,500 Revenue 10,000 Revenue (500) Dividends Assets
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This note was uploaded on 02/17/2009 for the course AIM 2301 taught by Professor Muslu during the Spring '08 term at University of Texas at Dallas, Richardson.

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Session%2004 - Solutions for Session 04 Assignments: P2-7A...

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