Exercise 1

The following information is available for Mullen Company for the year ended December 31, 2017:

Accounts payable4,700

Stock investments (long-term)8,400

Accumulated depreciation, equipment4,000

Retained earnings16,000

Common stock4,800

Intangible assets2,500

Notes payable (due in 5 years)6,000

Accounts receivable1,500

Cash2,600

Debt investments (short-term)3,000

Land10,000

Equipment7,500

Use the above information can you help meto make a classified balance sheet for the year ended December 31, 2017.

Exercise 2

Sara Obermeyer decides to open a pizza parlor near the local college campus that will operate as a corporation. Analyze the following transactions for the month of June in terms of their effect on the basic accounting equation. Record each transaction by increasing (+) or decreasing (-) the dollar amount of each item affected. Indicate the new balance of each item after a transaction is recorded. It is not necessary to identify the cause of changes in stockholders' equity.

Transactions

(1)Sara Obermeyer invests $25,000 cash in exchange for common stock to start a pizza parlor business on June 1.

(2)Purchased equipment for $4,000 paying $2,000 in cash and the remainder due in 30 days.

(3)Purchased supplies for $1,200 cash.

(4)Received a bill from Campus News for $200 for advertising in the campus newspaper.

(5)Cash receipts from customers for pizza sales amounted to $1,500.

(6)Paid salaries of $200 to employees.

(7)Billed the Tiger Football Team $300 for pizzas ordered.

(8)Paid $200 to Campus News for advertising that was previously billed in Transaction 4.

(9)Sara Obermeyer was paid dividends of $1,200.

(10)Incurred utility expenses for month on account, $100.

Trans-AccountsAccountsCommonRetained

actionCash+Receivable+Supplies+Equipment=Payable+Stock+Earnings

(1)

_____________________________________________________________

Balance

(2)

_____________________________________________________________

Balance

(3)

_____________________________________________________________

Balance

(4)

_____________________________________________________________

Balance

(5)

_____________________________________________________________

Balance

(6)

_____________________________________________________________

Balance

(7)

_____________________________________________________________

Balance

(8)

_____________________________________________________________

Balance

(9)

_____________________________________________________________

Balance

(10)

_____________________________________________________________

Totals