Question

The folowing are independent situations. ล. A company orders and receives 10 personal computers for office use for which it signs a note promising to pay $20,000 within three months b. A company purchases for $33,000 cash a new dellvery truck that has a list(sticker) price of $36,000 C. A women's dothing retailer orders 30 new display stands for $420 each for future delivery. d. A new company is formed and Issues 100 shares of stock for $12 per share to Investors. e. A company purchases a piece of land for $41,000 cash. An appraiser for the buyer valued the land at $46,700. t The owner of a local company uses a personal check to buy a $16,000 car for personal use. Answer from the company's point of view. g. A company borrows $8,000 from a local bank and signs a six-month note for the loan. h Acompany pays $2,700 owed on its 10-year notes payable (ignore interest. Required: 1. Indicate titles of the appropriate accounts, If any, affected in each of the preceding events 2-a. At what amount would you record the delvery truck in (b 2-b. At what amount would you record the piece of land in (e 2-C. What measurement principle are you applying? 3-a. what reasoning did you apply in 3-b. For ()l what accounting concept did you apply? Complete this question by entering your answers in the tabs below Req 1 Req 2A Req 2B Req 2C Req 3A Req 3B Indicate titles of the appropriate accounts, if any, affected in each of the preceding events. Consider what the company gives and receives C Req 1 Req 2A>

Answer 1

Part. 1

S.N.	Titles of Accounts	Given by the company	Received by the company
a)	Fixed Asset – Computer A/C	Promissory Note Payable (+L)	Computers or Computer equipment (+A)
b)	Fixed Asset – Truck Vehicles A/C	Cash (-A)	Truck Vehicles (+A)
c)	No exchange transaction	-	-
d)	Share Capital A/C	Share capital (Shares) (+SE)	Cash (+A)
e)	Fixed Asset – Land A/c	Cash (-A)	Land (+A)
f)	No exchange transaction	-	-
g)	Loan A/c	Promissory Note Payable (+L)	Cash (+A)
h)	Loan A/c	Cash (-A)	Promissory Note Payable (-L)

Part. 2

The truck amount $ 33,000 will be recorded in the account.

Part. 3

The Land will be initially recorded at $ 41,000 in the account. Also it can be recorded at appraiser value at the time of Revaluation.

Part 4

Cost principle is applied here.

Part 5

(c) is not a transaction because it is only an agreement which involves no exchange or receipt of cash, goods, or services.

Part 6

Transaction (f) occurs between the owner and outsiders,thus the separate entity assumption implies that this transaction does not affect the business  

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