Solutions_for_Exam_1_Homework_Problems

Solutions_for_Exam_1_Homework_Problems - Solutions for Exam...

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Solutions for Exam 1 Homework Problems E1-5 Liability Accounts payable   Asset Accounts receivable Asset Cash   Liability Notes payable Asset Cleaning equipment   Liability Salaries payable Asset Cleaning supplies   Stockholders' Equity Common stock E1-6     Assets Liability Stockholders'  Equity 1.  Sold common stock for cash to start business. Increase No Effect Increase 2.  Paid monthly rent. Decrease No Effect Decrease 3.  Purchased equipment on account. Increase Increase No Effect 4.  Billed customers for services performed. Increase No Effect Increase 5.  Paid dividends. Decrease No Effect Decrease 6.  Received cash from customers billed in (4). Decrease No Effect No Effect 7.  Incurred advertising expense on account. No Effect Increase Decrease 8.  Purchased additional equipment for cash. Decrease No Effect No Effect 9.  Received cash from customers when service was performed. Increase No Effect Increase
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P1-2A The following are ending balances on the financial statements that can be used as check figures: NASHVILLE VETERINARY CLINIC Income Statement For the Month Ended September 30, 2011 Revenues         Service revenue   $ 8,000 Expenses         Salaries expense $ 1,700       Rent expense 900       Advertising expense 300       Utilities expense 170         Total expenses   3,070 Net income (loss)   $ 4,930 NASHVILLE VETERINARY CLINIC Retained Earnings Statement For the Month Ended September 30, 2011 Retained earnings, September 1 $ 700
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Add: Net income 4,930   5,630 Less: Dividends 1,000 Retained earnings, September 30 $ 4,630 NASHVILLE VETERINARY CLINIC Balance Sheet September 30, 2011 Assets Cash   $ 15,200 Accounts receivable   5,900 Supplies   600 Office equipment 8,100   Total assets   $ 29,800 Liabilities and Stockholders' Equity Liabilities          Notes payable   $ 10,000      Accounts payable   2,170          Total Liabilities   12,170 Stockholders' equity         Common stock 13,000
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      Retained earnings 4,630 17,630         Total liabilities and stockholders' equity   $ 29,800 P1-4A Miller Deliveries Income Statement For the Month Ended June 30, 2011 Revenues         Service revenue   $ 5,900 Expenses         Salaries expense $ 1,000       Rent expense 500       Utilities expense 250       Gasoline expense 100         Total expenses   1,850
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Net income (loss)   $ 4,050 (c)  Prepare a balance sheet at June 30, 2011.  (List assets in order of liquidity and liabilities from largest to smallest,  eg 10, 7, 5.)   Miller Deliveries Balance Sheet June 30, 2011 Assets Cash   $ 8,200 Accounts receivable   3,150 Supplies   150 Delivery van   12,000      Total Assets   $ 23,500   Liabilities and Stockholders' Equity
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Solutions_for_Exam_1_Homework_Problems - Solutions for Exam...

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