Answered step by step
Verified Expert Solution
Question
1 Approved Answer
I don't know why it keeps saying it's wrong. 1. Stockholders invested $40,000 in the business in exchange for common stock of the company 2.
I don't know why it keeps saying it's wrong.
1. Stockholders invested $40,000 in the business in exchange for common stock of the company 2. Purchased computers for office use for $30,000 from Ladd on account. 3. Paid $4,000 cash for May rent on storage space. 4. Performed computer services worth $19,000 on account. 5. Performed computer services for Wharton Construction Company for $5,000 cash. 6. Paid Western States Power Co. $8,000 cash for energy usage in May. 7. Paid Ladd for the computers purchased in (2). 8. Incurred advertising expense for May of $1,300 on account. 9. Received $12,000 cash from customers for contracts billed in (4). Using the following tabular analysis, show the effect of each transaction on the accounting equation. Put explanations for changes to Stockholders' Equity in the far right column. (If a transaction causes a decrease in Assets, Liabilities or Stockholders' Equity, place a negative sign (or parentheses) in front of the amount entered for the particular Asset, Liability or Equity item that was reduced. See Illustration 3-3 for example.) Assets = Liabilities Stockholders' Equity + + Cash + Accounts Receivable + Equipment = Accounts Payable Common Stock + Retained Earnings Revenues - Expenses 40,000 40,000 Issued Stock 1 30,000 0001 (4000) 4000 4000 TL Rent Expense 1900 (1900) Service Revenue 5000 5000 T Service Revenue (8000) 8000 T Utilities Expense Welt (30000) (30000) 1300 300) T Advertising Expense 12000 (12000) 15000 7000 30000 40000 24000 13300Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started