P2 - 3A - Name: Instructor: Financial Accounting, 5th...

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FileName: 490e78da8259c0501de51b9a8cf3785e2612f71e.xls, Tab: Problem P2-3A, Page 1 of 3, 10/06/2009, 03:40:41 Name: Date: Instructor: Course: 1. Stockholders invested cash in the company in exchange for common stock. $120,000 2. Hired two employees to work in the warehouse. They will each be paid a salary of $20,000 per month. 3. Signed a 2-year rental agreement on a warehouse; paid $36,000 cash in advance for the first year. (Hint; The portion of the related to May 2006 is an expense for this month.) 4. Purchased furniture and equipment costing $70,000 A cash payment of $20,000 was made immediately; the remainder will be paid in 6 months. 5. Paid $3,000 cash for a one-year insurance policy on the furniture and equipment. (Hint: The portion of the cost related to May 2006 is an expense for this month.) Transactions during the remainder of the month: 6. Purchased basic office supplies for cash $1,000 7. Purchased more office supplies on account $3,000 8. Total revenues earned were $30,000 of this amount $10,000 was cash, and $20,000 9. Paid to suppliers on accounts payable due $800 10. Received cash from customers in payment of accounts receivable $5,000 11. Received utility bills to be paid next month in the amount of
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P2 - 3A - Name: Instructor: Financial Accounting, 5th...

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