Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The accountant for Compton Inc. has collected the following information: Compton purchased a tract of land from Jacobsen Real Estate for $886,000 cash. Compton issued

The accountant for Compton Inc. has collected the following information:

Compton purchased a tract of land from Jacobsen Real Estate for $886,000 cash.

Compton issued 2,000 shares of its common stock to George Micros in exchange for $100,000 cash.

Compton purchased a John Deere tractor for $53,000 on credit.

Michael Rotunno paid Compton $8,500 cash for services performed. The services had been performed by Compton several months ago for a total price of $10,000 of which Rotunno had previously paid $1,600.

Compton paid its monthly payroll by issuing checks totaling $27,550.

Compton declared and paid its annual dividend of $12,000 cash.

1. Prepare an analysis of the effects of these transactions on the accounting equation of the business. Use the format below. If an amount box does not require an entry, please, leave the cells blank or enter zero ("0"). Enter decreases in account values as negative numbers. If the effect of a transaction is to increase AND decrease the same item (i.e. Asset, Liability), enter "0" since the net effect on the item is zero.

image text in transcribed

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Democratic Audit Of Poland 2014

Authors: Radoslaw Markowski, Michal Kotnarowski, Michal Wenzel, Marta Zerkowska-Balas

1st Edition

3631656912, 978-3631656914

More Books

Students also viewed these Accounting questions

Question

What is the purpose of a limit check?

Answered: 1 week ago

Question

Classify delivery styles by type.

Answered: 1 week ago