PLEASE answer the following questions 1. As of April 1, Holy Grounds Coffee Corp
ID: 2548343 • Letter: P
Question
PLEASE answer the following questions
1. As of April 1, Holy Grounds Coffee Corp. had total stockholders' equity of $102,000. During April, it wrote checks for $16,000 in salaries expense, $31,000 in prepaid expenses, and $18,000 in rent expense. Assuming no other transactions occurred during April, what is Holy Grounds Coffee Corp.'s total stockholders' equity as of April 30?
2.
If What the Pho? Corp. issues 2,000 shares of $5 par value common stock for $140,000, the required correct journal entry will include a:
(Choose all of the correct answers.)
Debit to Cash for $10,000
3.
Sue Flay's Cakery Corp. began business by issuing 40,000 shares of $5 par common stock for $8 per share, and 10,000 shares of 6%, $10 par preferred stock for par. At the end of the year, common stock had a market value of $10 per share.
On its, December 31 balance sheet, Sue Flay's Cakery Corp. would report which of the following:
(Choose all of the correct answers.)
Common Stock of $200,000
4.
Sal Minella's Diner, Inc., reported net income of $180,000. Included in net income was depreciation expense of $26,000, and a loss on the sale of equipment for $3,000. During the year, these accounts changed as follows:
Accounts Receivable increased by $15,000
Inventory increased by $40,000
Prepaid Expenses decreased by $2,000
Accounts Payable decreased by $4,000
On the statement of cash flows, what is its net cash provided by operating activities?
5.
Anne Teak's Knick Knack Co. originally issued 2,000 shares of $10 par value common stock for $60,000 ($30 per share). It subsequently purchases 200 shares of treasury stock for $27 per share and resells these 200 shares of treasury stock for $29 per share.
In the entry to record the sale of the treasury stock, there will be a:
(Choose all of the correct answers.)
Credit to Additional Paid-in-Capital for $10,000Explanation / Answer
Answer
April 1 Stockholder's Equity
$102000
(-) Cash paid for salaries expenses
$16000
* This expense will decrease retained earnings, hence will decrease stockholder's equity
(-) cash paid for rent expenses
$18000
* This expense will decrease retained earnings, hence will decrease stockholder's equity
Stockholder's Equity as of April 30
$68000
Correct Journal Entry would be—
Cash
140000
Common Stock [2000 x $5]
10000
Additional Paid in capital [2000 x 65]
130000
Hence, correct answers are:
Debit to Cash for $140000
Credit to Additional paid in capital for $130000
Common Stock [40000 x $5]
$200000
Additional Paid In capital [40000 x $3]
$120000
6% Preference shares [10000 x $10]
$100000
Correct answers are:
Additional paid in capital of $120000
Common Stock of $200000
Hint: Add Decrease in Current Assets or Increase in Current Liabilities
Less Increase in Current Assets or Decrease in current liabilities
Net Income
$180000
Add: Depreciation expense
$26000
Add: loss on sale of equipment
$3000
Less: Accounts receivables increased
$15000
Less: Inventory increased
$40000
Add: prepaid expense decreased
$2000
Less; Accounts payable decreased
$4000
Net Cash provided by operating activities
$152000
Correct Journal entry would be
Cash [200 x $29]
5800
Treasury Stock [200 x $27]
5400
Additional Paid in Capital [200 x $2]
400
Hence, correct answers are:
Debit to cash for $5800
Credit to additional paid in capital for $400
Credit to Treasury Stock $5400
April 1 Stockholder's Equity
$102000
(-) Cash paid for salaries expenses
$16000
* This expense will decrease retained earnings, hence will decrease stockholder's equity
(-) cash paid for rent expenses
$18000
* This expense will decrease retained earnings, hence will decrease stockholder's equity
Stockholder's Equity as of April 30
$68000
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