Problems 1) Using the Horizontal Equation below, show the impact to Bobo Co. of

Question

Problems 1) Using the Horizontal Equation below, show the impact to Bobo Co. of the following transactions: a. Bobo borrows $300,000 from the bank. b. Bobo purchases equipment for $100,000. c. Bobo sells cleaning services to custoners for $30,000 cash. d. Bobo pays $20,000 cash for salaries. e. Bobo pays $10,000 in cash dividends to its owners f. The equipment purchased in b. is now worth $150,000. Assets Cash Equipment Notes Payable 2) Year End Statements for Tanglewood Industries contained the following elements and amounts: Assets $150,000; Liabilities-Common Stock-575,000, Revenue-S20,000; Dividends- $2,000; Beginning Retained Earnings $22,000 a. What is Ending Retained Earnings?

Explanation / Answer

1 ASSETS = LIABILITIES + STOCKHOLDERS EQUITY CASH EQUIPMENT NOTES PAYABLE PAID IN CAPITAL RETAINED EARNINGS a 300000 300000 b 100000 100000 c 30000 30000 d -20000 -20000 e -10000 -10000 f 50000 50000 2 Retained Earnings, Beg $22,000 Add : Revenue $20,000 Less : Dividends $2,000 Retained Earnings, Ending $40,000 b Total Assets - stockholders equity = Year end liabilities $150000-$40000-75000 35000 Year end liabilities = $ 35000

Related Questions

Navigate

• Browse (All)
• Browse P
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.