Chapter3problem

Chapter3problem - We are a real estate company. We...

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We are a real estate company. We purchase, improve and manage real estate properties. Here is our trial balance at beginning of year: DR/ (CR) Cash 150,000 Rent receivable 75,000 Prepaid expenses - Rental properties 10,000,000 Accumulated depreciation (2,500,000) Accounts payable (100,000) Notes payable (6,000,000) Contributions from owners (1,000,000) Retained earnings (625,000) - We had the following activity this year: (1) Purchased a new rental property for $1,000,000, financed by $200,000 contributions from owners and $800,000 borrowed on a note payable. (2) Accrued $5,000,000 of rental income. (3) Received payments for rent in the amount of $4,500,000 (4) Accrued property management expense of $735,000, of which $700,000 was paid. (5) Recorded depreciation expense of $1,000,000 (6) Accrued salaries of $250,000, all of which were paid by the end of the year. (7) Paid lenders $2,000,000, of which $1,750,000 was for interest, the rest to reduce the debt - * At the end of the year, $500,000 of the
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Chapter3problem - We are a real estate company. We...

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