PA2-1 Determining Financial Statement Effects of Various Transactions [LO 2-2, LO 2-5] Mallard Incorporated (MI) is a small manufacturing company that makes model trains to sell to toy stores. It has a small service department that repairs customers trains for a fee. The company has been in business for five years. At the end of the previous year, the accounting records reflected total assets of $520,000 and total liabilities of $210,000. During the current year, the following summarized events occurred:

a. Issued additional shares of common stock for $75,000 cash.

b. Borrowed $125,000 cash from the bank and signed a 10-year note.

c. Built an addition on the buildings for $180,000 and paid cash to the contractor.

d. Purchased equipment for the new addition for $37,500, paying $3,750 in cash and signing a note due in six months for the balance.

e. Returned a $3,750 piece of equipment, from (d), because it proved to be defective; received a reduction of the note payable.

f. Purchased a delivery truck (equipment) for $11,750; paid $8,225 cash and signed a nine month note for the remainder.

g. A stockholder sold $6,950 of his stock in Mallard Incorporated to his neighbor.

Required: 1. Complete the spreadsheet that follows, using plus (+) for increases and minus () for decreases for each account. The first transaction is used as an example. (Enter any decreases to account balances with a minus sign.) 3. Based on beginning balances plus the completed spreadsheet, provide the Total assets, liabilities and stockholders' equity at the end of year.

a. Issued additional shares of common stock for $75,000 cash b. Borrowed $125,000 cash from the bank and signed a 10-year note c. Built an addition on the buildings for $180,000 and paid cash to the contractor d. Purchased equipment for the new addition for $37,500, paying $3,750 in cash and signing a note due in e. Returned a $3,750 piece of equipment, from (d), because it proved to be defective; received a reduction f. Purchased a delivery truck (equipment) for $11,750; paid $8,225 cash and signed a nine month note for g. A stockholder sold $6,950 of his stock in Mallard Incorporated to his neighbor. six months for the balance of the note payable the remainder Required 1. Complete the spreadsheet that follows, using plus (+) for increases and minus () for decreases for each account. The first transaction is used as an example. (Enter any decreases to account balances with a minus sign.) Assets Liabilities Stockholders' Equity Notes Payable Common Stock Retained Earnings Cash Equipment Buildings 75,000 125,000 (180,000) (3,750) 75,000 125,000 , 180,000 33,750 (3,750) 11,750 (3,750) (8,225) (6,950) End 3. Based on beginning balances plus the completed spreadsheet, provide the Total assets, liabilities and stockholders' equity at the end of year. Amount a. Total assets at the end of the year b. Total liabilities at the end of the year c. Total stockholders' equity at the end of the year