Blossom Company

Problem-1

During 2017, Blossom Company entered into the following transactions.

1. Purchased equipment for $323,340 cash.
2. Issued common stock to investors for $139,300 cash.
3. Purchased inventory of $71,720 on account.

Using the following tabular analysis, show the effect of each transaction on the accounting equation. For Retained Earnings, use separate columns for Revenues, Expenses, and Dividends if necessary.

Problem-2

Presented below are three economic events. In each column, indicate whether the event increased, decreased, or had no effect on assets, liabilities, and stockholders’ equity.

(a) Purchased supplies on account.
(b) Received cash for performing a service.
(c) Expenses paid in cash.

Problem-3

 For each of the following accounts, indicate the effect of a debit or a credit on the account and the normal balance.

(a) Accounts Payable.
(b) Advertising Expense.
(c) Service Revenue.
(d) Accounts Receivable.
(e) Retained Earnings.
(f) Dividends.

Problem-4

 Transactions for Jayne Company for the month of June are presented below.

June 1 Issues common stock to investors in exchange for $5,000 cash.
2 Buys equipment on account for $1,100.
3 Pays $740 to landlord for June rent.
12 Bills Wil Wheaton $700 for welding work done.

Identify the accounts to be debited and credited for each transaction.

Problem-5

Transactions for Sheridan Company for the month of June are presented below.

June 1 Issues common stock to investors in exchange for $4,010 cash.
2 Buys equipment on account for $1,670.
3 Pays $710 to landlord for June rent.
12 Bills Wil Wheaton $830 for welding work done.

Journalize the transactions.

Problem-6

Cheyenne Corp. has the following transactions during August of the current year.

Aug. 1 Issues shares of common stock to investors in exchange for $13,900.
Aug. 4 Pays insurance in advance for 3 months, $2,200.
Aug. 16 Receives $800 from clients for services rendered.
Aug. 27 Pays the secretary $670 salary.

Indicate the basic analysis and the debit–credit analysis.

Problem-7

Grouper Corp. has the following transactions during August of the current year.

Aug. 1 Issues shares of common stock to investors in exchange for $10,010.
4 Pays insurance in advance for 3 months, $1,200.
16 Receives $880 from clients for services rendered.
27 Pays the secretary $600 salary.

Journalize the transactions.

Problem-8

From the ledger balances below, prepare a trial balance for Crane Company at June 30, 2017. All account balances are normal.

Accounts Payable $ 1,350 Service Revenue $8,910
Cash 5,750 Accounts Receivable 2,660
Common Stock 18,000 Salaries and Wages Expense 3,570
Dividends 1,630 Rent Expense 1,340
Equipment 13,310

Problem-9

Selected transactions for Front Room, an interior decorator corporation, in its first month of business, are as follows.

1. Issued stock to investors for $14,800 in cash.
2. Purchased used car for $10,400 cash for use in business.
3. Purchased supplies on account for $200.
4. Billed customers $4,250 for services performed.
5. Paid $200 cash for advertising start of the business.
6. Received $1,480 cash from customers billed in transaction (4).
7. Paid creditor $230 cash on account.
8. Paid dividends of $310 cash to stockholders.

Problem-10

Selected transactions for Riverbed Corp during its first month in business are presented below.

Sept. 1 Issued common stock in exchange for $19,200 cash received from investors.
5 Purchased equipment for $9,470, paying $3,650 in cash and the balance on account.
8 Performed services on account for $18,000.
14 Paid salaries of $1,200.
25 Paid $2,910 cash on balance owed for equipment.
30 Paid $760 cash dividend.