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Exam 1: An Introduction to Accounting

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Question 81

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The Campbell Company began operations on January 1,2015 and on that date issued $60,000 of common stock for cash.In addition,the company borrowed $40,000 from the bank.It provided services to its customers during 2015 and received $72,000 cash.During the year,it paid $80,000 cash for land,$50,000 for salaries,and $10,000 in cash dividends to the owners. Required: 1)Write an accounting equation and record the effects of each transaction under the appropriate heading.(Use specific accounting titles below the statement elements. )Precede the amount with a minus sign if the transaction reduces that section of the equation. Enter 0 for items not affected. 2)Prepare an income statement and a balance sheet for the 2015 accounting period.Precede the amount with a minus sign if the transaction reduces that section of the income statement.

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Question 82

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During 2015,Sawyer Company earned $42,000 of cash revenue and paid $28,200 of cash expenses and $1,600 in dividends to the company's owners.Enter each of these three events into the horizontal financial statements model,below.Indicate dollar amounts of increases and decreases.For cash flows,show whether they are operating activities (OA),investing activities (IA),or financing activities (FA).Precede the amount with a minus sign if the transaction reduces that section of the equation or cash flow.Enter 0 if there would be no entry in a column.

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Question 83

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Use the following information to answer questions Packard Company engaged in the following transactions during 2015,its first year in operations: (Assume all transactions are cash transactions. ) 1) Acquired $950 cash from the issue of common stock. 2) Borrowed $420 from a bank. 3) Earned $650 of revenues. 4) Paid expenses of $250. 5) Paid a $50 dividend. During 2016,Packard engaged in the following transactions: (Assume all transactions are cash transactions. ) 1) Issued an additional $325 of common stock. 2) Repaid $220 of its debt to the bank. 3) Earned revenues of $750. 4) Incurred expenses of $360. 5) Paid dividends of $100. -The amount of total equity on Packard's 2015 balance sheet is

Grimes Corporation reports the following cash transactions for the year ending December 31,2015,its first year of operation: 1)Issued common stock for $35,000 2)Borrowed $25,000 from a local bank 3)Purchased land for $40,000 4)Provided services to clients for $38,000 5)Paid operating expenses of $30,500 6)Paid $2,000 cash dividends to stockholders Required: a)What are the total assets for Grimes Corporation at December 31,2015? b)Prepare an income statement for 2015.Precede the amount with a minus sign if the transaction reduces that section of the income statement.

Financial accounting information is usually less detailed than managerial accounting information.

Glavine Company repaid a bank loan with cash.The cash flow from this event should be shown on the horizontal statements model as

Jackson Company paid $500 cash for salary expenses.Which of the following choices accurately reflects how this event affects the company's financial statements?

Jackson Company had a net increase in cash from operating activities of $10,000 and a net decrease in cash from financing activities of $2,000.If the beginning and ending cash balances for the company were $4,000 and $11,000,then net cash change from investing activities was: