Chapter3_withoutaccruals

Chapter3_withoutaccruals - We are a super-simple company....

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We are a super-simple company. We purchase stuff and sell it for a profit. Here is out trial balance at 1/1/2007: DR/ (CR) Cash 5,000 Accounts receivable - Inventory - Prepaid expenses - Fixed assets - Accounts payable (2,000) Debt - Common stock (3,000) Retained earnings - We had the following activity during January: (1) Sold common stock for $100,000 (2) Borrowed $200,000 from a bank, which matures at $2,500/ month (3) Purchased $75,000 of inventory, on credit (4) Sold goods for $55,000 on credit which cost $35,000 (5) Sold goods for $10,000 cash, which cost $7,000 (6) Made one $2,500 payment on the debt. (7) Made one $2,000 payment for interest on the debt. (8) Collected $45,000 from customers (9) Paid $60,000 to vendors. (10) (11) Paid $10,000 for payroll. (12) Paid $2,000 for advertising provided this month. (13) Paid Rent of $5,000 at the end of the month. BASED ON ALL OF THE ABOVE (i) RECORD ALL JOURNAL ENTRIES (ii) TRACK ACTVITY WITH T-ACCOUNTS AND (iii) SHOW THE BALANCE SHEET
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This note was uploaded on 08/06/2008 for the course ECON 3A taught by Professor Loster during the Summer '07 term at UCSB.

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Chapter3_withoutaccruals - We are a super-simple company....

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