No. Account Titles and Explanation Debit Credit 1. 2. 3. 4. 5. 6. Tim Latimer Co

Question

No. Account Titles and Explanation Debit Credit 1. 2. 3. 4. 5. 6. Tim Latimer Corporation had the following transactions.

1.
Sold land (cost $12,000) for $15,000. 2.
Issued common stock for $20,090. 3.
Recorded depreciation on buildings for $15,610. 4.
Paid salaries of $9,090. 5.
Issued1,450shares of $1par value common stock for equipment worth $8,930. 6.
Sold equipment (cost $12,100, accumulated depreciation $8,470) for $1,452.
For each transaction above, prepare the journal entry. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

No. Account Titles and Explanation Debit Credit 1.

2.
3.
4.
5.

6.


Tim Latimer Corporation had the following transactions. For each transaction above, prepare the journal entry. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Explanation / Answer

1. Sold land (cost $12,000) for $15,000. Dr Cash 15,000 Cr Land 12,000 Cr Gain on Sale 3,000 Increase investing cash flows by 15,000. You would also subtract the $3,000 gain from net income under operating activities on the statement of cash flows. 2. Issued common stock for $20,000. Dr Cash 20,000 Cr Common Stock 20,000 Increase financing cash flows by 20,000. 3. Recorded depreciation on buildings for $17,000. Dr Depreciation Expense 17,000 Cr Accumulated Depreciation 17,000 This would not directly affect cash flows, but it would be added to net income for operating activities on the statement of cash flows. 4. Paid salaries of $9,000. Dr Salaries Expense 9,000 Cr Cash 9,000 Decrease operating activities cash flow by $9,000. 5. Issued 1,000 shares of $1 par value common stock for equipment worth $8,000. Dr Equipment 8,000 Cr Additional Paid-In Capital, Common Stock 7,000 Cr Common Stock 1,000 Since this does not involve cash but it does change the company's financial position, it would be reported in the schedule of noncash investing and financing activities. 6. Sold equipment (cost $10,000, accumulated depreciation $7,000) for $1,200. Instructions Dr Cash 1,200 Dr Accumulated Depreciation 7,000 Dr Loss on Disposal 1,800 Cr Equipment 10,000 There would be an increased cash flow of $1,200 under investing activities. The $1,800 loss would also be added to net income under operating activities on the statement of cash flows.

Related Questions

Navigate

• Browse (All)
• Browse N
• Subjects

---

---

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