Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

At the beginning of April, Brooke Winston launched a custom computer programming company called Softways. The company had the following transactions during April: a. Brooke

At the beginning of April, Brooke Winston launched a custom computer programming company called Softways. The company had the following transactions during April:

a.

Brooke Winston invested $75,000 cash, office equipment with a value of $6,000, and $25,000 of computer equipment in the company in exchange for common stock.

b.

Purchased land worth $27,500 for an office by paying $5,000 cash and signing a long-term note payable for the balance.

c.

Purchased a portable building with $30,000 cash and moved it onto the land acquired in b.

d.

Paid $7,500 cash for the premium on a three-year insurance policy.

e.

Provided services to a client and collected $5,400 cash.

f.

Purchased $5,000 of additional computer equipment by paying $2,500 cash and signing a long-term note payable for the balance due.

g.

Completed $5,250 of services for a client on credit.

h.

Purchased $1,000 of additional office equipment from Yukon Office Supply on credit.

i.

Completed services for Johnson and Company for $10,200 on credit.

j.

Received a bill for $650 for rent of a piece of the computer equipment used on a recently completed job. The bill is to be paid within 30 days.

k.

Received $5,100 from Johnson and Company for work completed in transaction i.

l.

Semi-Monthly payroll totaled $2,000 and was paid in cash.

m.

Paid $1,000 to Yukon Office Supply for office equipment purchased in transaction h.

n.

Paid $750 for minor repairs on computer equipment.

o.

Paid $1,800 cash for advertising.

p.

Semi-Monthly payroll totaled $2,000 and was paid in cash.

q.

Paid $5,000 cash for dividends.

Required:

1. Open the following T-accounts: Cash, Accounts Receivable, Prepaid Insurance, Office Equipment, Computer Equipment, Building, Land, Accounts Payable, Long-Term Notes Payable, Common Stock, Retained Earnings, Fees Earned, Wages Expense, Computer Rental Expense, Advertising Expense, and Repairs Expense. Record the transactions by entering debits and credits directly in the T-accounts. Use transaction letters to identify each debit and credit.

2. Prepare an unadjusted trial balance as of April 30.

3. Prepare the Income Statement and Balance Sheet for the company on April 30.


4. Calculate the company's debt ratio. Use $140,300 as its total assets amount.

5. Are the company's assets financed more by debt or equity?

DO IT IN MS WORD

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Fundamentals Of Quality Auditing

Authors: B. Scott Parsowith

1st Edition

0873892402, 978-0873892407

More Books

Students also viewed these Accounting questions

Question

Why are ratios and trends used in financial analysis?

Answered: 1 week ago

Question

Discuss the various types of policies ?

Answered: 1 week ago

Question

Briefly explain the various types of leadership ?

Answered: 1 week ago

Question

Explain the need for and importance of co-ordination?

Answered: 1 week ago

Question

Explain the contribution of Peter F. Drucker to Management .

Answered: 1 week ago