Question

Required information Rawlco Communications operates 10 radio stations. The following events occurred during September. a. Placed an order for office supplies costing $1,500. Supplier intends to deliver later in the month. b. Purchased equipment that cost $20,000; paid $6,000 cash and signed a promissory note to pay $14,000 in one month. c. Negotiated and signed a one-year bank loan, and then deposited $5,000 cash in the company's checking account. d. Hired a new finance manager on the last day of the month. e. Received an investment of $8,000 cash from the company's owners in exchange for issuing common shares. f. Supplies [ordered in (a)] were received, along with a bill for $1,500. 3. Rawlco began the month with $150,000 in total assets. What total assets would be reported on the balance sheet after events (a)- Ending Total Assets

Answer 1

Transaction	Description	Increase in assets	Decrease in assets	Net effect on assets
a	It did not affect any asset since no supplies were received	0	0	0
b	Equipment increased by $20,000 and cash decreased by $6,000	20,000	6,000	14,000
c	It did not affect any asset	0	0	0
d	It did not affect any asset	0	0	0
e	Cash increased by $8,000	8,000	0	8,000
f	Supplies increased by $8,000	1,500	0	1,500
	Total	$29,500	$6,000	$23,500

Ending total assets = Beginning total assets + Net increase in assets

= 150,000 + 23,500

= $173,500

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