Solutions for Exercises 1-5, 1-10, 1-11

Solutions for Exercises 1-5, 1-10, 1-11 - (12,000 12,000 =...

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EXERCISE 1-5 a. James Auto Parts Accounting Equation Claims Assets = Liabilities + Stockholders’ Equity $9,100 = $2,600 + $6,500 Liabilities $9,100 – $6,500 = $2,600 Claims $2,600 + $6,500 = $9,100 b. Best Candy, Inc. Accounting Equation Claims Assets = Liabilities + Stockholders’ Equity $7,800 = $2,400 + $5,400 Assets  $2,400 + $5,400 = $7,800 c.  Sam’s Dive Shop Accounting Equation Claims Assets = Liabilities + Stockholders’ Equity $49,200 = $21,600 + $27,600
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Stockholders’ Equity $49,200 – $21,600 = $27,600 Investor’s claims are equal to Stockholders’ Equity:  $27,600
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EXERCISE 1-10 Event Statement of Cash Flow Classification a. OA b. FA c. FA d. IA e. OA f. OA g. IA h. FA i. NA j. FA
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EXERCISE 1-11 a. Quick Service Company Accounting Equation for 2004 Assets = Liabilities + Stockholders’ Equity Event Cash + Land = Notes Payable + Common Stock + Retained  Earnings Acct.  Title/RE Bal. 1/1/04 25,000 + 50,000 = 35,000 + 30,000 + 10,000 1. Pur. Land
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Unformatted text preview: (12,000) + 12,000 = NA + NA + NA NA 2. Issued Stk. 20,000 + NA = NA + 20,000 + NA NA 3. Provide Svc. 65,000 + NA = NA + NA + 65,000 Revenue 4. Paid Exp. (42,000) + NA = NA + NA + (42,000) Op. Exp. 5. Paid Note (20,000) + NA = (20,000) + NA + NA NA 6. Paid Div. (3,000) + NA = NA + NA + (3,000) Dividend 7. Land Value NA + NA = NA + NA + NA Totals 33,000 + 62,000 = 15,000 + 50,000 + 30,000 b. Net Income for 2004: Revenue $65,000 Operating Expense (42,000) Net Income $23,000 c. Total assets at the end of 2004: Cash $33,000 Land 62,000 Total Assets $95,000 Stockholders’ Equity at the end of 2004: Total Assets $95,000 o r Common Stock $50,000 Less: Liabilities (15,000) Plus: Retained Earnings 30,000 Total Stockholders’ Equity $80,000 Total Stockholders’ Equity $80,000...
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