i More Info 2. The Baxter Company was incorporated on November 1, 20X0. Baxter had 100 holders of common stock. Reya Baxter, the Re president and chief executive officer, held 60% of the shares. The company rented space in chain discount stores and specialized 1. in selling ladies' accessories. Baxter's first location was in a store that was part of The Shop Haven in Green Bay. The following events occurred during November: i (Click the icon to view the events and transactions.) 3. a. The company was incorporated. Common stockholders invested $450,000 cash. - X Requirement 1. Prepare an analysis of Baxter Company's transactions. Enter the events into Baxter Company's accounting equation one transaction at a time. For transaction d., enter the sale on line d1. and balance of each account. (Leave any unused cells blank. Enter decreases with a minus sign or parentheses and leave any unused cells + + Liabilities + Stockholders' Equity Assets Merch. Prepaid Equip. Inv. + Rent + and Fixt. = N/P + A/P + + + Paid-in Retained Capital + Earnings + + + + + + + Cash + A/R a. b. + + + C. + + + + d1. + + + + + + d2. + + + + e. f. + + + + + + + g. h. + + + + + + + + + + b. Purchased merchandise inventory for cash, $25,000. c. Purchased merchandise inventory on open account, $65,000. d. Merchandise carried in inventory at a cost of $25,000 was sold for cash for $42,000 and on open account for $63,000, for a grand total of $105,000. Baxter (not The Shop Haven) carries and collects these accounts receivable. e. Collection of accounts receivable, $26,000. See transaction (d). f. Payments of accounts payable $25,000. See transaction (c). g. Special display equipment and fixtures were acquired on November 1 for $122,400. Their expected useful life was 72 months. This equipment was removable. Baxter paid $18,000 as a down payment and signed a promissory note for $104,400. Also see transaction (k). h. On November 1, Baxter signed a rental agreement with The Shop Haven. The agreement called for a flat $2,500 per month, payable quarterly in advance. Therefore, Baxter paid $7,500 cash on November 1. i. The rental agreement also called for a payment of 15% of all sales. This payment was in addition to the flat $2,500 per month. In this way, The Shop Haven would share in any success of the venture and be compensated for general services such as cleaning and utilities. This payment was to be made in cash on the last day of each month as soon as the sales for the month had been tabulated. Therefore, Baxter made the payment on November 30. j. Employee wages and sales commissions were all paid for in cash. The amount was $31,000. k. Depreciation expense of $1,700 was recognized ($122,400/72 months). See transaction (g). I. The expiration of an appropriate amount of prepaid rental services was recognized. See transaction (h). Choose from any list or enter any number in the input fields and then continue to the next question. Print Done