The Kelly Company purchased a building for $75,000 in cash. What is the effect on current assets?
A company had $250,000 of current assets and $90,000 of current liabilities before borrowing $60,000 from the bank with a 3-month note payable. What effect did the borrowing transaction have on the amount of the company’s current ratio?
Which of the following would increase retained earnings?
An increase in a Revenue account increases Net Income, which in turn would increase Retained Earnings.
A company had the following account balances at the end of its first year of operations. Find the missing amounts.
|Inventory||400||Property and equipment||1200|
|Accounts payable||500||Salaries payable||800|
|Common Stock||1475||Retained earnings||525|
|Accounts payable||$12,000||Accounts Receivable||20,900|
|Common Stock||?||Sales Revenue||90,700|
|Cost of Goods Sold||51,500||Depreciation Expense||1,450|
|Dividends||6,600||Note Payable (due 3/1 Year 4)||20,000|
|Marketable Securities||1,400||Prepaid Expenses||18,000|
|Note Payable (due 5/30 Year 2)||12,400||Service Revenue||22,550|
|Retained Earnings (1/1 Year 1 )||39,700||Salary Expense||18,000|
|Accrued Expenses Payable||1,500||Unearned Revenue||30,500|
A company began operations at the start of Year 1.
During the year, it had cash sales of $50,000 and credit sales of $450,000. The company collected $420,000 in cash from the credit sales. The company purchased inventory costing $250,000 and paid $18,000 in dividends. The company incurred the following expenses:
|Cost of goods sold||210,000||Rent expense||6,000|
|Salary expense||80,000||Depreciation expense||4,000|
|Interest expense||5,000||Income tax expense||57,000|
Using this information, answer the following questions.