A) General Journals (30 points) On 1 January 2021, Ana Torres began a new business, called Pharmaly Inc., a service company dedicated to developing digital marketing campaigns for pharmaceutical companies. The following transactions were completed by the business during January 1 January: Issued 1100 shares of capital stock in exchange for her investment of 110,000 cash. 2 January: Purchased IT equipment for 160,000, paying 20,000 cash and signing a note payable for the balance. 3 January: Acquired furniture for the new office for 75,000, paying 25,000 cash and signing a note payable for the balance. 4 January: Borrowed 150,000 from a bank 5 January: Billed customers 1955,000 for services performed. 31 January: Received an invoice for electricity consumption 120, to be paid February 10" Prepare the General journals a B) T Accounts & trial Balance (30 + 10 points) On 1 January 2021, Ewa Alonso began a new business, called Translation opportunities Inc., a service company dedicated to developing software for self-driven cars. The following transactions were completed by the business during January 1 January: Issued 200 shares of capital stock in exchange for her investment of 2,000,000 cash. 2 January: Purchased IT equipment for 400,000, paying 100,000 cash and signing a note payable for the balance 3 January: Signed a rental contract for 6 months paying 2 months in advance. The monthly cost for the rental is 10,000. 8 January: Collected 100,000 as an advance payment from customer Tata, for a software to be developed in a three months contract. 10 January: Billed customers 105,000 for services performed to be collected on January 31" 31 January: Collected 105,000 from customers. Prepare the T accounts for the above transactions Prepare a trial balance C) Indicate if each of the following accounts are Revenues, Expenses, Assets or Liabilities (13 points) Revenues Expenses Assets Liabilities Sales Cost of Goods sold Direct labor Building Cash Accounts Receivable Capital Depreciation General wares Inventories Social security expense Machines Freights expense Lawyers esxpense Consultants expense Bonds payable Marketing expenses Commissions payable Accounts Payable Short term loan Interest expenses Notes receivable Income tax expense Computers Retained Earnings Accumulated Depreciation 5.200 900 3500 400 D) Company Peter's associates Inc, shows the following Balance Sheet. Assets Liabilities & SHE Cash 15.400 Accounts payable Prepaid rent 800 Salaries payable Unexpired insurance 3.000 Unearned revenue Accounts receivable 8.200 Income taxes payable Supplies 900 Current assets 28.300 Current liabilities Notes payable Automobile 37.700 Total liabilities: Accoumulated depreciation: auto -12.000 25.700 Stockholders Equity Equipment and music 39.000 Capital stock Accoumulated depreciation: equipment -13.000 26.000 Retained earnings Dividends Total stockholders equity Total assets 100.000 Total liabilities and stockholders equity 10.000 53.800 63.700 3.000 3.000 66.700 Which is the amount of retained earnings? (10 points) E) Brief questions 1.- Explain where do you find the net book value of a company and how do you calculate it. (3 points) 2.- Define what is working capital and how do you know if a company has a good liquidity position. (4 points)
