3 Summarize the journal entry effects from part 2 using Tacc

3. Summarize the journal entry effects from part 2 using T-accounts. Cash Supplies Beg. Bal. Beg. Bal. Required Information The following Informatlon applies to the questions displayed below End. Bal. End. Bal. Bearings&Brakes; Corporation (B&B;) was incorporated as a private company. The companys accounts indluded the following at June 30: Equipment Buildings Beg. Bal. Beg. Bal. End. Bal End. Bal. S 79,00O 600,000 00,000 270,000 168,000 494,000 3,000 016,000 6,000 Accounts Payable Buildings Cash Common Stock Land Accounts Payable Beg. Bal Land Notes Payable (long-term) Retained Earnings Supplics End. Bal. End. Bal. Notes Payable Common Stock Beg. Bal. Beg. Bal During the month of Juty, the company had the following actvities: a. Issued 3,900 shares of common stock for $390,000 cash. b. Borrowed $110,000 cash from a local bank, payable in four years. End. Bal. End. Bal. Retained Earnings Beg. Bal End. Bal.

Solution

Date Particulars Debit $ Credit $ July Cash A/c                                                    Dr 3,90,000 To Common Stock A/c 3,90,000 Issue of shares of Common Stock July Cash A/c                                                    Dr 1,10,000 To Bank Loan (term loan) A/c 1,10,000 Borrowed cash from Local Bank Cash Beg. Bal. 1,00,000 Common Stock 3,90,000 Bank Loan 1,10,000 End. Bal. 6,00,000 Supplies Beg. Bal.        6,000 End. Bal.        6,000 Equipment Beg. Bal. 1,68,000 End. Bal. 1,68,000 Buildings Beg. Bal. 6,00,000 End. Bal. 6,00,000 Land Beg. Bal. 4,94,000 End. Bal. 4,94,000 Accounts Payable Beg. Bal.        79,000 End. Bal.        79,000 Notes Payable Beg. Bal.           3,000 End. Bal.           3,000 Bank (Term) Loan Beg. Bal.                  -   Cash     1,10,000 End. Bal.     1,10,000 Common Stock Beg. Bal.     2,70,000 Cash     3,90,000 Cash (Bank Loan)     1,10,000 End. Bal.     7,70,000 Retained Earnings Beg. Bal. 10,16,000 End. Bal. 10,16,000