Question

Model trains for sale to toy stores are produced by Whistle Stop Incorporated, a small manufacturing company. Whistle Stop also has a small service department that repairs customers' model trains for a fee. The company has been in business for five years. At the end of the most recent year, 2016, the accounting records reflected total assets of $570,000 and total liabilities of $270,000. During the current year, 2017, the following summarized events occurred: a. Issued additional shares for $135,000 cash. b. Borrowed $102,000 cash from the bank and signed a ten-year note. c. Built an addition on the factory for $214,000 and paid cash to the contractor. d. Purchased equipment for the new addition for $51,000, paying $5,100 in cash and signing a note due in six months for the balance. e. Returned a $5,100 piece of equipment, from (d), because it proved to be defective; received a reduction of the note payable. f. Purchased a delivery truck (equipment) for $13,500; paid $5,000 cash and signed a nine-month note for the remainder. 9. A shareholder sold $12,000 worth of his shares in Whistle Stop Incorporated to his neighbour. Required: 1. Complete the spreadsheet given below, for increases and decreased in each account. The first transaction is used as an example. (Enter any decreases to account balances with a minus sign.) Liabilities Transaction Assets Cash Equipment 135,000 Building Notes Payable Shareholders' Equity Contributed Retained Capital Earnings 135,000 a. b. c. d. e. 9 135,000 0 0 135,000

Answer 1

Transaction	Assets			=	liabilities	+	Stockholders equity
	Cash	Equipment	Buildings		Notes payable		Cont capital	R.E
a.	135,000						135,000
b.	102,000				102,000
c.	-214,000		214,000
d.	-5,100	51,000			45,900
e.		-5,100			-5,100
f.	-5,000	13,500			8,500
g.	no entry
	12,900	59,400	214,000		151,300		135,000
2-a)	No
3)
a	Total assets at the end of the year					856,300
b	total liabilities at the end of the year					421,300
c	total shareholders equity at the end of the year					435,000
4)	Liabilities