X Company was created on September 1 and prepares monthly financial statements.
ID: 2483684 • Letter: X
Question
X Company was created on September 1 and prepares monthly financial statements. During September, the company had the following transactions: Received $88,000 from a group of investors and received a $80,000 loan from the bank. Bought $8,872 of merchandise, $3,380 for cash and $5,492 on account. Bought equipment costing $10,200, paying the manufacturer $6,000 in cash and promising to pay the remaining $4,200 next month. Sold merchandise for $21,620, of which $17,053 was for cash and $4,567 was on account; cost of the merchandise was $10,810. Paid $3,548 to suppliers for merchandise previously bought on account. Collected $2,622 from customers on account. Paid wages of $5,650. Paid a total of $549 for rent and insurance in advance. Recorded depreciation of $1,850. Recorded a total of $115 for rent and insurance that had expired. 5. What were total equities on September 30? Tries 0/3 6. What was Net Income in September? Tries 0/3.
Explanation / Answer
Equity and Net Income is prepared as under:
X Company
Merchandise Cash Equipment Accounts receivable Accounts Payable Sales Loan Investors Cost of goods sold Wages Prepaid Insurance Depreciation Accumulated De Rent/Ins opening 3,548 3,548 1 168000 80,000 88,000 2 8,872 3,380 5,492 3 -6,000 10,200 4,200 4 -10810 17,053 4,567 21,620 10,810 5 -3,548 -3,548 6 2,622 -2,622 7 -5,650 5,650 8 -549 549 9 1,850 1,850 10 -115 115Related Questions
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