Question
The following transactions occurred during March 2016 for Wainwright Corporation. The company owns and operates a wholesale warehouse. 1. Issued 44,000 common shares in exchange
The following transactions occurred during March 2016 for Wainwright Corporation. The company owns and operates a wholesale warehouse. |
1. | Issued 44,000 common shares in exchange for $440,000 in cash. |
2. | He purchased equipment at a cost of $68,000. $17,000 cash was paid and a promissory note was signed for the balance due. |
3. | Inventory purchased on account at a cost of $134,000. The company uses the perpetual inventory system. |
4. | Credit sales for the month totaled $190,000. The cost of goods sold was $114,000. |
5. | You paid $6,000 in rent on the warehouse building for the month of March. |
6. | You paid $6,850 to an insurance company for fire and liability insurance for a period of one year beginning April 1, 2016. |
7. | He paid $114,000 on account for the merchandise purchased at 3. |
8. | Collected $85,500 from clients on account. |
9. | Recorded depreciation expense of $1,700 per month on the equipment. |
Analyze each transaction and show the effect of each on the accounting equation for a corporation.
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