Question

Part i I- Due 1/29 Nike, Inc., with headquarters in Beaverton, Oregon, is one of the world's leading manufacturers of athletic shoes and sports apparel. The folowing activities occurred during a recent year. The amounts are rounded to millions. a. Purchased additional buildings for $172 and equipment for $270; paid $432 in cash and signed a long-term note for the rest b. Issued 100 shares of $2 par value common stock for $345 cash. c. Declared $145 in dividends to be paid in the following year d. Purchased additional short-term investments for $7,616 cash. e. Several Nike investors sold their own stock to other investors on the stock exchange for $84 f. Sold $4,313 in short-term investments for $4,313 in cash. Required: For each of the events (a) through (). perform transaction analysis and indicate the account, amount, and direction of the effect ( for increase and- for decrease) on the acoounting equation. Check that the accounting equation remains in balance after each transaction. (If no impact on the accounting equation leave cells blank. Enter your answers in millions.) Assets Common stock b Cash payable d.

Answer 1

Answer

Transaction	Assets		Liabilities		Stockholder's Equity
a	Building	$172	Notes Payable - Long Term	$10
	Equipment	$270
	Cash	($432)
b	Cash	$345			Common Stock	$200
					Additional paid in capital in excess of par Common Stock	$145
c			Dividends Payable	$145	Dividends / Retained earnings	($145)
d	Cash	($7,616)
	Short Term Investments	$7,616
e
f	Cash	$4,313
	Short Term Investments	($4,313)

• Note: Transaction ‘e’ DOES NOT AFFECT the accounting equation because the same is not to be recorded. It’s not the company’s transaction. Its stockholder’s own transaction.