horngren_accounting_6e_stop_and_think_answers

horngren_accounting_6e_stop_and_think_answers - Horngren...

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Horngren Accounting 6e ANSWERS TO ‘Stop & Think’ QUESTIONS CHAPTER 1 1-1 According to the cost principle, assets and services should be recorded at their actual cost. As $56 000 was paid for the land, report the land at $56 000. 1-2 To answer both questions, use the accounting equation: 1. Assets Liabilities = Owners’ Equity $370 000 $280 000 = $90 000 2. Assets = Liabilities + Owners’ Equity $88 000 = $36 000 + $52 000 1-3 Paula Lee eTravel Balance Sheet as at 9 April 20X7 Assets Liabilities Cash at bank $10 000 Accounts payable $500 Office supplies 500 Land 20 000 Owners’ Equity Paula Lee, capital 30 000 Total assets $30 500 Total liabilities and owners’ equity $30 500
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