Intermediate Accounting: E2-1 Wainwright Corporation. The company owns and operates a wholesale
Important Reminder!!! There might be other versions of this problem - amounts and dates have been changed - so please make sure you review and compare this tutorial to the problem in your homework. Intermediate Accounting E2-1 Transaction Analysis The following transactions occurred during March 2013 for the Wainwright Corporation. The company owns and operates a wholesale warehouse. 1. Issued 30,000 shares of capital stock in exchange for $300,000 in cash. 2. Purchased equipment at a cost of $40,000. $10,000 cash was paid and a note payable was signed for the balance owed. 3. Purchased inventory on account at a cost of $90,000. The company uses the perpetual inventory system. 4. Credit sales for the month totaled $120,000. The cost of the goods sold was $70,000. 5. Paid $5,000 in rent on the warehouse building for the month of March. 6. Paid $6,000 to an insurance company for fire and liability insurance for a one-year period beginning April 1, 2013. 7. Paid $70,000 on account for the merchandise purchased in 3. 8. Collected $55,000 from customers on account. 9. Recorded depreciation expense of $1,000 for the month on the equipment. Required: Analyze each transaction and show the effect of each on the accounting equation for a corporation.
You'll get 1 file (12.1KB)