P2-3 Recording P2-3 Recording Transactions in T-Accounts, Preparing the Balance Sheet from a Trial Balance, and Evaluating the Current Ratio LO2-2, 2-4, 2-5 Cougar Plastics Company has been operating for three years. At December 31, 2014, the accounting records reflected the following: Cash $ 22,000 Accounts payable $ 15,000 Investments (short-term) 3,000 Accrued liabilities payable 4,000 Accounts receivable 3,000 Notes payable (short-term) 7,000 Inventory 20,000 Long-term notes payable 47,000 Notes receivable (long-term) 1,000 Common stock 10,000 Equipment 50,000 Additional paid-in capital 80,000 Factory building 90,000 Retained earnings 31,000 Intangibles 5,000 During the year 2015, the company had the following summarized activities: a. Purchased short-term investments for $10,000 cash. b. Lent $5,000 to a supplier who signed a two-year note. c. Purchased equipment that cost $18,000; paid $5,000 cash and signed a one-year note for the balance. d. Hired a new president at the end of the year. The contract was for $85,000 per year plus options to purchase company stock at a set price based on company performance. e. Issued an additional 2,000 shares of $0.50 par value common stock for $11,000 cash. f. Borrowed $9,000 cash from a local bank, payable in three months. g. Purchased a patent (an intangible asset) for $3,000 cash. h. Built an addition to the factory for $24,000; paid $8,000 in cash and signed a three-year note for the balance. i. Returned defective equipment to the manufacturer, receiving a cash refund of $1,000. Required: 1. & 2. Record each necessary entry for the events in 2015 in T-accounts (including referencing) and determine the ending balances. The balances at the end of 2014 have been entered as beginning balances for 2015. (Transaction (a) has been completed in the T-accounts as an example.) Transactions in T-Accounts, Preparing the Balance Sheet from a Trial Balance, and Evaluating the Current Ratio LO2-2, 2-4, 2-5 Cougar Plastics Company has been operating for three years. At December 31, 2014, the accounting records reflected the following: Cash $ 22,000 Accounts payable $ 15,000 Investments (short-term) 3,000 Accrued liabilities payable 4,000 Accounts receivable 3,000 Notes payable (short-term) 7,000 Inventory 20,000 Long-term notes payable 47,000 Notes receivable (long-term) 1,000 Common stock 10,000 Equipment 50,000 Additional paid-in capital 80,000 Factory building 90,000 Retained earnings 31,000 Intangibles 5,000 During the year 2015, the company had the following summarized activities: a. Purchased short-term investments for $10,000 cash. b. Lent $5,000 to a supplier who signed a two-year note. c. Purchased equipment that cost $18,000; paid $5,000 cash and signed a one-year note for the balance. d. Hired a new president at the end of the year. The contract was for $85,000 per year plus options to purchase company stock at a set price based on company performance. e. Issued an additional 2,000 shares of $0.50 par value common stock for $11,000 cash. f. Borrowed $9,000 cash from a local bank, payable in three months. g. Purchased a patent (an intangible asset) for $3,000 cash. h. Built an addition to the factory for $24,000; paid $8,000 in cash and signed a three-year note for the balance. i. Returned defective equipment to the manufacturer, receiving a cash refund of $1,000. Required: 1. & 2. Record each necessary entry for the events in 2015 in T-accounts (including referencing) and determine the ending balances. The balances at the end of 2014 have been entered as beginning balances for 2015. (Transaction (a) has been completed in the T-accounts as an example.)