Higgins Company has been operating for one year (2014). You are a member of the management team investigating expansion ideas that will require borrowing funds from banks. At the start of 2015, Higgins’s T-account balances were as follows: Assets: Cash Short-Term Investments Property and Equipment 4,400 2,300 2,600 Liabilities: Short-Term Notes Payable Long-Term Notes Payable 1,400 390 Stockholders’ Equity: Common Stock Additional Paid-in Capital Retained Earnings 660 2,640 4,210 The following transactions occured in 2015: (a) Borrowed $3,000 from a local bank, signing a note due in three years. (b) Sold $800 of the investments for $800 cash. (c) Sold one-half of the property and equipment for $1,300 in cash. (d) Declared and paid $320 in cash dividends to stockholders. 2. Enter the above 2015 transactions in the T-accounts:
Higgins Company has been operating for one year (2014). You are a member of the management team investigating expansion ideas that will require borrowing funds from banks. At the start of 2015, Higgins’s T-account balances were as follows: Assets: Cash Short-Term Investments Property and Equipment 4,400 2,300 2,600 Liabilities: Short-Term Notes Payable Long-Term Notes Payable 1,400 390 Stockholders’ Equity: Common Stock Additional Paid-in Capital Retained Earnings 660 2,640 4,210 The following transactions occured in 2015: (a) Borrowed $3,000 from a local bank, signing a note due in three years. (b) Sold $800 of the investments for $800 cash. (c) Sold one-half of the property and equipment for $1,300 in cash. (d) Declared and paid $320 in cash dividends to stockholders. 2. Enter the above 2015 transactions in the T-accounts:
Financial Accounting: The Impact on Decision Makers
10th Edition
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Gary A. Porter, Curtis L. Norton
Chapter13: Financial Statement Analysis
Section: Chapter Questions
Problem 13.8E
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Higgins Company has been operating for one year (2014). You are a member of the management team investigating expansion ideas that will require borrowing funds from banks. At the start of 2015, Higgins’s T-account balances were as follows: |
| Assets: |
| Cash | Short-Term Investments | Property and Equipment |
|
4,400 |
|
2,300 |
|
2,600 |
|
| Liabilities: |
| Short-Term Notes Payable | Long-Term Notes Payable |
|
|
1,400 |
|
390 |
|
|
| Common Stock | Additional Paid-in Capital |
|
|
660 |
|
2,640 |
|
4,210 |
| The following transactions occured in 2015: |
| (a) | Borrowed $3,000 from a local bank, signing a note due in three years. |
| (b) | Sold $800 of the investments for $800 cash. |
| (c) | Sold one-half of the property and equipment for $1,300 in cash. |
| (d) | Declared and paid $320 in cash dividends to stockholders. |
| 2. | Enter the above 2015 transactions in the T-accounts: |
|
|
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