Section #2—TA ANSWER KEY!!!
Wang Corporation was organized on April 1, 20B.
Wang Corporation issued shares of
capital stock to each of the six owners who paid $18,000 in total.
On the basis of
transactional analysis, the following entry should be recorded.
A debit to cash for $18,000 and a credit to revenue for $18,000.
A credit to cash for $18,000 and a debit to retained earnings for $18,000.
A credit to cash for $18,000 and a debit to contributed capital for $18,000.
A debit to cash for $18,000 and a credit to contributed capital for $18,000.
None of the above is correct.
Assume a company's January 1, 20A, financial position was:
Assets, $75,000 and
During January 20A, the company completed the following
(a) paid on a note payable $5,000 (no interest was paid); (b) collected
an accounts receivable, $4,000; (c) paid an accounts payable, $3,000; and (d)
purchased a truck, $2,000 cash, and received a $13,000 note payable.
company's January 31, 20A financial position is
None of the above.
During 2004, Blue Corporation incurred operating expenses amounting to $100,000 of
which $75,000 were paid in cash; the balance will be paid in January 2005.
analysis of operating expenses for 2004, should reflect only the following
A) decrease stockholders' equity, $75,000; decrease assets, $75,000.
B) decrease assets, $100,000; decrease stockholders' equity, $100,000.
C) decrease assets, $100,000; increase liabilities, $25,000; decrease stockholders' equity,
D) decrease stockholders' equity, $100,000; decrease assets, $75,000; increase