Principles of Accounting Volume 1
Principles of Accounting Volume 1
19th Edition
ISBN: 9781947172685
Author: OpenStax
Publisher: OpenStax College
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Bearings & Brakes Corporation (B&B) was incorporated as a private company. The company’s accounts included the following at June 30:

Accounts Payable $ 61,000
Buildings 580,000
Cash 98,000
Common Stock 250,000
Equipment 164,000
Land 484,000
Notes Payable (long-term) 13,000
Retained Earnings 1,006,000
Supplies 4,000

During the month of July, the company had the following activities:

Issued 3,700 shares of common stock for $370,000 cash.
Borrowed $100,000 cash from a local bank, payable in four years.
Bought a building for $182,000; paid $74,000 in cash and signed a three-year note for the balance.
Paid cash for equipment that cost $98,000.
Purchased supplies for $98,000 on account.
PB2-2 Part 4
Prepare a trial balance at July 31.

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    Journal Entries Overnight Delivery Inc. is incorporated on February 1 and enters into the following transactions during its first month of operations: February 15: Received $8,000 cash from customer accounts. February 26: Provided $16,800 of services on account during the month. February 27: Received a $3,400 bill from the local service station for gas and oil used during February. February 28: Paid $400 for wages earned by employees for the month. February 28: Paid $3,230 for February advertising. February 28: Declared and paid $2,000 cash dividends to stockholders. Required Prepare journal entries on the books of Overnight to record the transactions entered into during February. Explain why you agree or disagree with the following: The transactions on February 28 all represent expenses for the month of February because cash was paid. The transaction on February 27 does not represent an expense in February because cash has not yet been paid.
    Financial statements The assets and liabilities of Global Travel Agency on December 31, 20Y5, and its revenue and expenses for the year are as follows: Common stock was 525,000 and retained earnings was 1,250,000 as of January 1, 20Y5. During the year, additional common stock of 50,000 was issued for cash, and dividends of 90,000 were paid. Instructions 1. Prepare an income statement for the year ended December 31, 20Y5. 2. Prepare a statement of stockholders equity for the year ended December 31, 20Y5. 3. Prepare a balance sheet as of December 31, 20Y5. 4. What items appears on both the statement of stockholders equity and the balance sheet?
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