Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

CHAPTER 3 The Income Statement Required: For each of the transactions, prepare journal entries. Be sure to categorize each account as an asset (A), liability

image text in transcribed
CHAPTER 3 The Income Statement Required: For each of the transactions, prepare journal entries. Be sure to categorize each account as an asset (A), liability (L), stockholders' equity (SE), revenue (R), or expense (E). PA3-3 Analyzing the Effects of Transactions Using T-Accounts. Preparing an Unadjusted LO 3-1, 3-2, 3-3, 3-4 Trial Balance, and Determining Net Income and Net Profit Margin Spicewood Stables, Inc. was established in Dripping Springs, Texas, on April 1. The company provides stables, care for animals, and grounds for riding and showing horses. You have been hired as the new assistant controller. The following transactions for April are provided for your review. 1. Received contributions from investors and issued $200,000 of common stock on April 1. 2. Built a barn and other buildings for $142,000. On April 2, the company paid half the amount in cash and signed a three-year note payable for the balance. 3. Provided $16,000 in animal care services for customers on April 3, all on credit. 4. Rented stables to customers who cared for their own animals: received cash of $13,000 on April 4 for rent earned this month. 5. On April 5, received $1,500 cash from a customer to board her horse in May, June, and July (record as Unearned Revenue). 6. Purchased hay and feed supplies on account on April 6 for $3,000. 7. Paid $1,700 on accounts payable on April 7 for previous purchases. 8. Received $1,000 from customers on April 8 on accounts receivable. 9. On April 9, prepaid a two-year insurance policy for $3,600 for coverage starting in May. 10. On April 28, paid $800 in cash for water and utilities used this month. 17. Paid $14,000 in wages on April 29 for work done this month. 12. Received an electric utility bill on April 30 for $1,200 for usage in April; the bill will be paid next month

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

Analytical Corporate Valuation Fundamental Analysis, Asset Pricing, And Company Valuation

Authors: Pasquale De Luca

1st Edition

331993550X, 9783319935508

More Books

Students also viewed these Accounting questions