Accounts Payable Buildings Cash Common Stock Equipment Land Notes Payable (long-

Question

Accounts Payable Buildings Cash Common Stock Equipment Land Notes Payable (long-term) Retained Earnings Supplies $ 20,000 00,000 36,000 180,000 118,000 200,000 2,000 259,000 7,000 During the month of July, the company had the following activities: a. Issued 4,000 shares of common stock for $400,000 cash. b. Borrowed $100,000 cash from a local bank, payable in two years. c. Bought a building for $182,000; paid $82,000 in cash and signed a three-year note for the balance d. Paid cash for equipment that cost $200,000. e. Purchased supplies for $30,000 on account.

Explanation / Answer

Trial balance:

Dr. Cr.

cash[36000+400000+100000-82000 -200000] 254000

equipment[118000+200000] 318000

Land 200000

Notes payable[2000+100000+100000] 202000

Accounts payable[20000+30000] 50000

Retained earning 259000

Building[100000+182000] 282000

supplies[7000 + 30000] 37000

Common stock[180000+400000] - 580000

   $1091000 $1091000

5. Assets

current assets

cash    254000

supplies   37000

total current asset 291000

fixed assets

equipment 318000

Land 200000

Building 282000

Assets $1091000

  Liabilities

current liabilities

Notes payable 202000

Accounts payable 50000

Total current liabilities 252000

equity

Retained earning    259000

common stock 580000

liabilities $1091000

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