Question

Required information E2-9 (Algo) Analyzing the Effects of Transactions in T-Accounts LO 2-4 [The following information applies to the questions displayed below.) Griffin Service Company, Inc., was organized by Bennett Griffin and five other investors. The following activities occurred during the year a. Received $81,000 cash from the six investors; each investor was issued 9,500 shares of common stock with a par value of $0.10 per share. b. Purchased equipment for use in the business at a cost of $29,000; one-fourth was paid in cash and the company signed a note for the balance (due in six months). c. Signed an agreement with a cleaning service to pay $230 per week for cleaning the corporate offices next year d. Received an additional contribution from investors who provided $4,100 in cash and land valued at $26,000 in exchange for 2,100 shares of stock in the company. e. Lent $3,600 to one of the investors, who signed a note due in six months. f. Bennett Griffin borrowed $8,100 for personal use from a local bank, signing a one-year note. E2-9 Part 2 2. Using the balances in the T-accounts, fill in the following amounts for the accounting equation: Assets = Liabilities + Stockholders' Equity

Answer 1

Cash Common Stock Debit Debit 81,000 lb 4,100 e Credit 7,250 3,600 Credit 5,700 210 d d Bal 74,250 Bal 5,910 Equipment Debit 29,000 Credit Additional Paid-in Capital Debit Credit a 75,300 d 29,890 Ib Bal 29,000 Bal 1,05,190 Note Payable Debit |Ь Credit 21,750 Land Debit 26,000 Credit d Bal 21,750 Bal 26,000 Note Receivable Debit 3,600 Credit e Bal 3,600

+ + + Assets = Liabilities Equity Note Common Additional Paid- No Cash + Equipment + Receivable + Land = Note Payable + Stock + in Capital a 81,000+ 5,700 + 75,300 |ь -7,250 + 29,000 + 21,750 + d 4,100 + 26,000 = 210 + 29,890 -3,600 + 3,600 + Total 74,250 + 29,000 + 3,600 + 26,000 = 21,750 + 5,910 + 1,05,190 + + 1 + + + e +

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