Transactions The following selected transactions were completed by Cota Delivery Service during July: 1. Received cash in exchange for common stock, $35,000. 2. Purchased supplies for cash, $1,100. 3. Paid rent for October, $4,500. 4. Paid advertising expense, $900. 5. Received cash for providing delivery services, $33,000. 6. Billed customers for delivery services on account, $58,000. 7. Paid creditors on account, $2,900. 8. Received cash from customers on account, $27,500. 9. Determined that the cost of supplies on hand was $300 and $8,600 of supplies had been used during the month. 10. Paid cash dividends, $2,500. Indicate the effect of each transaction on the accounting equation by listing the numbers identifying the transactions, (1) through (10), in a column, and inserting at the right of each number the appropriate letter from the following list: A. Increase in an asset, decrease in another asset. B. Increase in an asset, increase in a liability. C. Increase in an asset, increase in stockholders’ equity. D. Decrease in an asset, decrease in a liability. E. Decrease in an asset, decrease in stockholders’ equity.

BuyFind

Financial And Managerial Accounting

15th Edition
WARREN + 1 other
Publisher: Cengage Learning,
ISBN: 9781337902663
BuyFind

Financial And Managerial Accounting

15th Edition
WARREN + 1 other
Publisher: Cengage Learning,
ISBN: 9781337902663

Solutions

Chapter 1, Problem 12E
Textbook Problem

Transactions

The following selected transactions were completed by Cota Delivery Service during July:

  1. 1. Received cash in exchange for common stock, $35,000.
  2. 2. Purchased supplies for cash, $1,100.
  3. 3. Paid rent for October, $4,500.
  4. 4. Paid advertising expense, $900.
  5. 5. Received cash for providing delivery services, $33,000.
  6. 6. Billed customers for delivery services on account, $58,000.
  7. 7. Paid creditors on account, $2,900.
  8. 8. Received cash from customers on account, $27,500.
  9. 9. Determined that the cost of supplies on hand was $300 and $8,600 of supplies had been used during the month.
  10. 10. Paid cash dividends, $2,500.

Indicate the effect of each transaction on the accounting equation by listing the numbers identifying the transactions, (1) through (10), in a column, and inserting at the right of each number the appropriate letter from the following list:

  1. A. Increase in an asset, decrease in another asset.
  2. B. Increase in an asset, increase in a liability.
  3. C. Increase in an asset, increase in stockholders’ equity.
  4. D. Decrease in an asset, decrease in a liability.
  5. E. Decrease in an asset, decrease in stockholders’ equity.

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Chapter 1 Solutions

Financial And Managerial Accounting
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