1 Issued 30000 shares of common stock In exchange for 300000

1. Issued 30,000 shares of common stock In exchange for $300,000 In cash. 2 Purchased equipment at a cost of $40,000. $10,000 cash was pald and a note payable was slgned for the balance owed. 3. Purchased Inventory on account at a cost of $90,000. The company uses the perpetual Inventory system. 4. Credit sales for the month totaled $120,000. The cost of the goods sold was $70,000. 5. Pald $5,000 In rent on the warehouse bullding for the month of March. 6. Pald $6,000 to an Insurance company for fire and lablity Insurance for a one-year perlod beginning April 1, 2018. 7. Pald $70,000 on account for the merchandise purchased In 3. 8. Collected $55,000 from customers on account 9. Recorded depreclation expense of $1,000 for the month on the equlpment Post the above transactions to the below T-accounts. Assume that the opening balances In each of the accounts is zero. Prepare a trial balance from the ending account balances. Complete this question by entering your answers in the tabs below. T Accounts Trial Balance Post the above transactions to the below T-accounts. Assume that the opening balances in each of the accounts is zero. (Enter the number of the transaction in the column next to the amount.) ash Beg. Bal Beg. Bal End. Bal End. Bal Prepaid I Beg. Bal Beg. Bal End. Bal End. Bal Equipment Bal Bal End. Bal End. Bal Accounts Payable Note Payable Beg. Bal Beg. Bal. End. Bal End. Bal Stock Sales Revenue Beg. Bal Beg. Bal End. Bal End. Bal

Solution

Answer 1. Cash Accounts Receivable Inventory Beg. Bal.                     -        10,000.00 2 Beg. Bal.                     -      55,000.00 8 Beg. Bal.                   -        70,000.00 4-b. 1    300,000.00        5,000.00 5 4-a    120,000.00 3    90,000.00 8      55,000.00        6,000.00 6      70,000.00 7 End. Bal.    264,000.00 End. Bal.      65,000.00 End. Bal.    20,000.00 Prepaid Insurance Equipment Accumulated Depreciation Beg. Bal.                     -   Beg. Bal.                     -   Beg. Bal.                   -          1,000.00 9 6        6,000.00 2      40,000.00 End. Bal.        6,000.00 End. Bal.      40,000.00 End. Bal.        1,000.00 Accounts Payable Note Payable Common Stock Beg. Bal.                     -   Beg. Bal.                   -   Beg. Bal.                     -   7      70,000.00      90,000.00 3    30,000.00 2    300,000.00 1 End. Bal.      20,000.00 End. Bal.    30,000.00 End. Bal.    300,000.00 Sales Revenue Cost of Goods Sold Rent Expense Beg. Bal.                     -   Beg. Bal.                     -   Beg. Bal.                   -      120,000.00 4-a 4-b.      70,000.00 5      5,000.00 End. Bal.    120,000.00 End. Bal.      70,000.00 End. Bal.      5,000.00 Depreciation Expense Beg. Bal.                     -   9        1,000.00 End. Bal.        1,000.00 Answer 2. Trial Balance Accounts Title Debits Credits Cash    264,000.00 Accounts Receivable      65,000.00 Inventory      20,000.00 Prepaid Insurance        6,000.00 Equipment      40,000.00 Accumulated Depreciation        1,000.00 Accounts Payable      20,000.00 Note Payable      30,000.00 Common Stock    300,000.00 Sales Revenue    120,000.00 Cost of Goods Sold      70,000.00 Rent Expense        5,000.00 Depreciation Expense        1,000.00 Total    471,000.00    471,000.00