Question

The folowing information applies to the questions displayed balow Use the horizontal model, or write the journal entry, for each of the fellowing transactions and adjustments that occurred during the first year of operations at Kissick Co. e. Issued 210,000 shares of $6-par-value common stock for $1,260,000 in cash. b. Borrowed $540,000 from Oglesby National Bank and signed a 11% note due in two years. C, Incurred and paid $400,000 in salanes for the year. d. Purchased $690,000 of merchandise inventory on account during the year e. Sold inentory costing $650,000 far a total of $980,000, all on credit f. Paid rent of $110,000 on the sales facilities during the first 11 months of the year g. Purchased $170,000 of store equipment, paying $50,000 in cash and agreeing to pay the difference within 90 days. h. Paid the entire $120,000 owed for stare equipment arnd $610,000 of the amount due to suppliers for credit purchases previously recorded Incurred and paid utilities expense of S43,000 during the year J. Collected $845,000 in cash from customers during the year for credit sales previously recorded. k. At year end, accrued $59,400 of interest on the note due to Oglesby National Bank L. At year-end, accrued $10,000 of past-due December rent on the sales facilities Required information 2.50 points Record each transaction in the appropriate columns. (If an transaction/Adjustment are not affecting the balance sheet category or income statment, leave the cells blank. Enter decreases to account balances as as negative.) ASSETS LIABILITIES Net income Revenue-Expenses EQUITY Common Stock Transaction Accounts Merchandise Accounts Cash RecelvableInventory+EquipmentPayablePayable

Answer 1

Stockholders Equity Assets Liabilities Net Income = | Revenue | - Transaction Accounts Merchandise Notes Accounts Common | Cash Receivable +Inventory+Equipment Payable + Payable+ Stock +| $ 1,260,000| 1,260,000 $1+ 1,260,000 S 540,000+ $540,000+ 400,000 650,000 110,000 ←| $ (400,000)| 690,000 690,000+ +980,000(650,000)+ S 330,000 980,000 (110,000)+ $ (110,000) + S 170.000 120,000+ (730,000)+ $ (43,000)+ S 845,000 (845,000) + +$(730,000)+ ←| $ (43,000) S43,000 $ 59,400 10,000 40,000 | + | $ 170,000-ו s540,000 | + | S 149,400 | + | S 1260,000 | ← | $ (292,4001-I $980,000 | - | SI,272,400 ←| $ ←| $ (59,400) (10,000) = tls 10,000| + $ 1,312,000 | + | $ 135,000 | + | S