Question
The following transactions occurred during March 2018 for the Wainwright Corporation. The company owns and operates a wholesale warehouse. Issued 30,000 shares of common stock
The following transactions occurred during March 2018 for the Wainwright Corporation. The company owns and operates a wholesale warehouse.
Issued 30,000 shares of common stock in exchange for $300,000 in cash.
Purchased equipment at a cost of $40,000. $10,000 cash was paid and a note payable was signed for the balance owed.
Purchased inventory on account at a cost of $90,000. The company uses the perpetual inventory system.
Credit sales for the month totaled $120,000. The cost of the goods sold was $70,000.
Paid $5,000 in rent on the warehouse building for the month of March.
Paid $6,000 to an insurance company for fire and liability insurance for a one-year period beginning April 1, 2018.
Paid $70,000 on account for the merchandise purchased in 3.
Collected $55,000 from customers on account.
Recorded depreciation expense of $1,000 for the month on the equipment.
Required: Analyze each transaction and show the effect of each on the accounting equation for a corporation. (Amounts to be deducted should be indicated by a minus sign. Enter the net change on the accounting equation.)
Assets = Liabilities + Paid-In Capital + Retained Earnings
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