Brief Exercises Be2 Individual

Brief Exercises BE2-8, BE2-9, and BE2-10

University of Phoenix

Principles of Accounting ACC 300

Julio 16, 2009

BE2-8. Mulkeen Service Company, Inc. was organized by Conor Mulkeen and five other investors. The following activities occurred during the year:

a. Received $60,000 cash from the investors; each was issued 1,000 shares of capital stock.

b. Purchased equipment for use in the business at a cost of $12,000; 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 it $120 per week for cleaning the

corporate offices, beginning next week.

d. Lent $2,000 to one of the investors who signed a note due in six months.

e. Conor Mulkeen borrowed $10,000 for personal use from a local bank, signing a one-year note.

1. Create T-accounts for the following accounts: Cash, Notes Receivable, Equipment, Notes Payable, and Contributed Capital. Beginning balances are zero. For each of the above transactions, record its effects in the appropriate T-accounts. Include good referencing and totals for each T-account.

2. Using the balances in the T-accounts fill in the following amounts for the accounting equation: Assets $ _ = Liabilities $ _ + Stockholders’ Equity $

3. Explain your response to events c and e.

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Assets = Liabilities + Stockholders Equity

$64,880 = $10,880 + $54,000

En el evento C se reporta como pagado en cash pero Notes receivable en liabilities pues no se ha recibido el servicio todavía. En el evento E la transacción no se reporta en los libros porque fue una transacción personal que no envuelve a la compañía.

BE2-9. During its first week of operations, January 1–7, 2006, Faith’s Fine Furniture Corporation completed six transactions with the dollar effects indicated in the following schedule:

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1. Write a brief explanation of transactions 1 through 6. Explain any assumptions that you made.

2....