Question
White Magnolia Inc. is a leading manufacturer and retailer of home furnishings in the United States and abroad. The following is adapted from White Magnolias
White Magnolia Inc. is a leading manufacturer and retailer of home furnishings in the United States and abroad. The following is adapted from White Magnolias September 30, 2016, trial balance. (The amounts shown represent millions of dollars.)
Accounts Payable $132
Accounts Receivable 30
Cash 140
Common Stock 30
Equipment 375
Inventory 176
Notes Payable (long-term) 235
Notes Payable (short-term) 2
Prepaid Rent 32
Retained Earnings 389
Salaries and Wages Payable 40
Software 75
Assume that the following events occurred in the following quarter.
a) Paid $35 cash for additional inventory.
b) Issued additional shares of common stock for $15 in cash.
c) Purchased equipment for $210; paid $100 in cash and signed a note to pay the remaining $110 in two years.
d) Signed a short-term note to borrow $15 cash.
e) Conducted negotiations to purchase a sawmill, which is expected to cost $38.
4. Summarize the journal entry effects from part 3 using T-accounts. Use the September 30, 2016, ending balances as the begi balances for the October-December 2016 quarter. (Enter your answers in millions (i.e., 10,000,000 should be entered as Answer is not complete. Accounts Receivable 30 Beg. Bal. Beg. Bal. Cash 140 15 15 35 35 a. 100C. End. Bal End. Bal. 30 Inventory 176 35 Prepaid Rent 32 Beg. Bal. Beg. Bal. End. Bal. 211 End. Bal. 32 Equipment 375 Software 75 Beg. Bal Beg. Bal. 100 X 110 c. d. End. Bal. . 165 End. Bal. 75 Accounts Payable Salaries and Wages Payable 40 Beg. Bal. 132 Beg. Bal. End. Bal. 132 End. Bal. Notes Payable (short-term) Beg. Bal. Beg. Bal. 2 15% Notes Payable (long-term) 235 X 110 End. Bal. 17 End. Bal. 345 Common Stock 30 15 X Retained Earnings 389 Beg. Bal. Beg. Bal. End. Bal. 45 End. Bal. 389
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started