Principal is due in 2 loans payable operating 3

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Principal is due in 2 years. +20 = +20 Loans Payable = Operating 3. Purchased $300 of bicycle inventory on credit. +300 Inventory = +300 Accounts Payable = Operating 4. Sold bicycles for cash of $507. The cost of the bikes sold was $180. +507 -180 Inventory = +327 Retained Earnings 507 Sales 180 Cost of Goods Sold = 327 Operating 5. Sold and invoiced bicycles to a client for $95. The cost of the bikes sold was $48. -48 Inventory +95 AR = +47 Retained Earnings 95 Sales 48 Cost of Goods Sold = 47 Operating 6. On February 1, paid $84 for 12 months’ rent. -84 +84 Prepaid Rent = = 3
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Riffe – ACCT 6201 – Session 9 –Fall 2018 Balance Sheet Income Statement Transaction Cash Asset + Noncash Assets = Liabil- ities + Contrib. Capital + Earned Capital Rev- enues Expenses = Net Income Operating 7. Paid $24 in cash for supplies to have on hand for bike repairs. -24 +24 Supplies = = Operating 8. Collected $60 from accounts receivable. +60 -60 Accounts Receivable = = Operating 9. Paid $200 for bikes purchased on credit in 3. -200 = -200 Accounts Payable = Financing 10. Paid cash dividends of $3. -3 = -3 Dividends = Operating 11. Received $6 cash from a customer for maintenance services to be delivered in future. +6 = + 6 Unearned Revenue = Operating 12. Wages paid during the year were $15. -15 = -15 Retained Earnings +15 Wage Expense = -15 Investing 13. Purchased Govt. Debt Securities for $12. -12 +12 Marketable Securities = = 4
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Riffe – ACCT 6201 – Session 9 –Fall 2018 ADJUSTING TRANSACTIONS Balance Sheet Income Statement NOTICE THERE IS NO IMPACT ON CASH FOR ADJUSTING TRANS. Transaction Cash Asset + Noncash Assets = Liabil- ities + Contrib. Capital + Earned Capital Rev- enues Expenses = Net Income a. Record rent for period ending 12/31. -77 Prepaid Rent = -77 Retained Earnings +77 Rent Expense = -77 b. The truck received in 1. is expected to be used for five years. Record 12/31 deprec. -7 Accumulated Depreciation = -7 Retained Earnings + 7 Depreciation Expense = -7 c. 14 in supplies are left at 12/31 -10 Supplies = -10 Retained Earnings + 10 Supplies Expense = -10 d. Billed customer $9 for bicycle service plan but no cash was received during year. +9 Accounts Receivable = + 9 Retained Earnings + 9 Sales = +9 e. As of 12/31 Mkt. Sec. have earned interest income of $2 that will be received in January of the next year. + 2 Interest Receivable +2 Retained Earnings + 2 Interest Income +2 f. The services in 11 were delivered. = -6 Unearned Revenue + 6 Retained Earnings + 6 Sales = + 6 5
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Riffe – ACCT 6201 – Session 9 –Fall 2018 Balance Sheet Income Statement Transaction Cash Asset + Noncash Assets = Liabil- ities + Contrib. Capital + Earned Capital Rev- enues Expenses = Net Income g. Record interest at December 31 for Transaction 2. = + 1 Interest Payable -1 Retained Earnings + 1 Interest Expense = -1 h. Employees have earned wages of $3 as of the end of the year that have not been paid in cash. = + 3 Wages Payable -3 Retained Earnings +3 Wage Expense = -3 i. Taxes were $8 for the year and will be paid in April of the next year.
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  • Fall '09
  • Robbins
  • Balance Sheet, Generally Accepted Accounting Principles

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