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Ierofanga [76]
3 years ago
6

Describe the effect of each transaction on assets, liabilities, and stockholders' equity.

Business
1 answer:
Aliun [14]3 years ago
8 0

Answer:

<u><em>Issued Common Stock to Investors in exchange for Cash received from investors</em></u>

Stockholders Equity = Increase

Assets = Increase

Liabilities = No Effect

<u><em>Paid Monthly Rent</em></u>

Assets = Decrease

Stockholders equity = Decrease

Liabilities = No Effect

<u><em>Received cash from customers when service is performed</em></u>

<em>Assets = Increase</em>

Stockholders Equity = Increase

Liabilities = No Effect

<u><em>Billed Customers when service is performed</em></u>

<em>Assets = Increase</em>

Liabilities = No Effect

Stockholders Equity = Increase

<em />

Explanation:

<u><em>Issued Common Stock to Investors in exchange for Cash received from investors</em></u>

Stockholders Equity increase due to increase in issue of additional common stock.

Assets increase due to inflow of asset of Cash resulting from the issue.

<u><em>Paid Monthly Rent</em></u>

Stockholders equity decrease due to increase in an expense item (Rent) which decreases profits attributable to stockholders.

Assets decrease due to outflow of economic benefits in form of cash.

<u><em>Received cash from customers when service is performed</em></u>

Shareholders Equity increase increase due to inflow of economic benefits in form of revenue, which would consequently increase profit attributable to shareholders.

Assets are increasing due to inflow of economic benefits in form of cash.

<u><em>Billed Customers when service is performed</em></u>

Assets are increasing due to increase of future economic benefit in form of Accounts Receivable.

Shareholders Equity increase increase due to inflow of economic benefits in form of revenue, which would consequently increase profit attributable to shareholders.

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Under what circumstances might they change their portfolios, moving their funds out of bonds into bank accounts? In general, people place their funds in those investments which provide them the highest returns.
4 0
3 years ago
If a typical firm in a perfectly competitive industry is earning profits. True or False
Gwar [14]

Answer:

The answer is True.

Explanation:

Because, then new firms will enter in the long run causing market supply to decrease, market price to fall , and profits to decrease.

6 0
3 years ago
g On the first day of its fiscal year, Chin Company issued $10,000,000 of five-year, 7% bonds to finance its operations of produ
Elis [28]

Answer and Explanation:

According to the scenario, computation of the given data are as follow:-

Total Years = 5, semiannually = 5 × 2 = 10

Rate = 7% yearly, semiannually rate = 7 ÷ 2 = 3.5%  

Journal Entries

On Jan 1

Cash A/c           Dr. $9,594,415

Discount on bonds payable A/c        Dr. $405,585

      To Bonds payable A/c          $10,000,000

(Being the issuance of bond payable is recorded)

Discount value of issued bonds = $10,000,000 - $9,594,415 = $405,585

2).

On Jun

Interest expenses A/c             Dr. $390,559

Discount on bonds payable A/c($405,585 ÷10)           Dr.40,559

 To Cash A/c($10,000,0000 × 3.5%)     $350,000

(Being the payment of first semiannual interest is recorded)

3).  

On Dec 31

Interest expenses A/c              Dr. $390,559

Discount on bonds payable A/c($405,585*10/100)     Dr.$40,559

 To Cash A/c($10,000,000*3.5/100)      $350,000

(Being the payment of second semiannual interest is recorded)

b). Bond Interest Expense Amount for First Year

= Interest Expenses + Amortized Discount

= $700,000 + $81,117

= $781,117

Interest expenses = $350,000 + $350,000 = $700,000

Amortized Discount = $40,559 + $40,559 = $81,117

c).The Company issued the bonds at $9,594,415 for the face amount of $10,000,000 because bonds issued at discount for $405,585 as the coupon rate is less than the market interest.  

4 0
3 years ago
Marigold corp. has 634000 shares of $10 par value common stock outstanding. during the year marigold declared a 13% stock divide
Vera_Pavlovna [14]

No. of shares outstanding before stock dividend = 634000

Price per share = $46

Stock dividend issued (shares issued) = 634000 x 13%

= 82,420

Value of stocks issued as stock dividend = 82420 x $46 = $3,791,320

No. of shares outstanding after stock dividend = 634,000 +82,420

=716420

Cash dividend = 716420 x 0.60

= 429,852

Total reduction in retained earnings = total value of dividend issued

= $3,791,320 + $429,852

= $4,221,172

3 0
4 years ago
you have to wait until it says i posted it 1 minute ago if answer before u will be elminated 2 more to go
Blizzard [7]

Answer:

GG

Explanation:

GG

7 0
3 years ago
Read 2 more answers
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