Notes: • Word-process your solutions within this template. Copy and paste tables from Excel as needed.• Show all steps used in arriving…

Notes: • Word-process your solutions within this template. Copy and paste tables from Excel as needed. • Show all steps used in arriving at the final answers. Incomplete solutions will receive partial credit. Problem 1 For the following accounts, classify as a current asset (CA), noncurrent asset (NCA), current liability (CL), noncurrent liability (NCL), or stockholders’ equity (SE). Indicate whether each account usually has a debit or credit balance. Accounts Receivable Retained Earnings Taxes Payable Prepaid Expenses Contributed Capital Long-Term Investments Plant, Property, and Equipment Accounts Payable Short-Term Investments Long-Term Debt Problem 2 Suppose a company performs the following activities within a year. For each activity, perform transaction analysis and indicate the account, amount, and direction of the effect on the account equation. Use the following headings: Assets = Liabilities + Stockholders’ Equity The activities are shown below. (a) Purchased new equipment costing $20,000, paying $14,000 in cash and signing a note for the rest (b) Declared $11,000 in dividends to be paid the following year (c) Sold $2,312 in short-term investments for cash (d) Investors sold their own stock to other investors on the stock exchange for $121,000 (e) Issued $1,000 of additional common stock shares, and received cash from investors Problem 3 Shown below are several transactions for a corporation and what accounts are affected. Using the given dollar amounts, explain in words the transaction that took place. Use the transactions to create a balance sheet. (a) Cash = +$8,000, Contributed Capital = +$8,000 (b) Cash = +$42,000, Note payable (short-term) = + $42,000 (c) Cash = −$2,000, Equipment +$5,000, Note payable (short-term) = +$3,000 (d) Cash = −$6,000, Note receivable (short-term) = +6,000 (e) Cash = −$1,800, Supplies = +$1,800 Problem 4 Given below is the balance sheet for a company. Balance Sheet (Millions of Dollars) Assets Current Assets Cash $5,846 Short-term investments 518 Receivables and other assets 4,510 Inventories 607 Other 2,624 $14,105 Noncurrent Assets Property, plant, and equipment $1,594 Long-term investments 318 Other non-current assets 2,533 Total assets $18,550 Liabilities and Stockholders’ Equity Current Liabilities Accounts payable $5,816 Other short-term obligations 4,585 $10,401 Long-term Liabilities $5,159 Stockholders’ equity Contributed Capital $7,832 Retained Earnings 14,690 Other stockholders’ equity items −19,532 Total stockholders’ equity and liabilities $18,550 Assume the following transactions (in millions) during the remainder of the initial year. (a) Borrowed $20 from banks due in two years (b) Lent $170 to affiliates, who signed a six-month note (c) Purchased additional investments for $6,000 cash; one-third were long term and the rest were short-term (d) Purchased $1820 worth of property, plant, and equipment; paid $600 in cash and the remainder with additional long-term bank loans (e) Issued additional shares of stock for $400 in cash (f) Sold short-term investments costing $3,000 for $3,000 cash (g) Declared and paid $13 in dividends during Year 1 Prepare a journal entry for each transaction. Then create T-accounts for each balance sheet account and include the new transactions. Post each journey entry to the appropriate T-accounts. Finally, create an updated balance sheet. PS. I need this done by 4 pm tomorrow, if you do before that time I will pay more. PLZ help.

MBA 503

Module Two Homework

Notes:

· Word-process your solutions within this template. Copy and paste tables from Excel as needed.

· Show all steps used in arriving at the final answers. Incomplete solutions will receive partial credit.

Problem 1

For the following accounts, classify as a current asset (CA), noncurrent asset (NCA), current liability (CL), noncurrent liability (NCL), or stockholders’ equity (SE). Indicate whether each account usually has a debit or credit balance.

Accounts Receivable

Retained Earnings

Taxes Payable

Prepaid Expenses

Contributed Capital

Long-Term Investments

Plant, Property, and Equipment

Accounts Payable

Short-Term Investments

Long-Term Debt

Problem 2

Suppose a company performs the following activities within a year. For each activity, perform transaction analysis and indicate the account, amount, and direction of the effect on the account equation. Use the following headings:

Assets = Liabilities + Stockholders’ Equity

The activities are shown below.

(a) Purchased new equipment costing $20,000, paying $14,000 in cash and signing a note for the rest

(b) Declared $11,000 in dividends to be paid the following year

(c) Sold $2,312 in short-term investments for cash

(d) Investors sold their own stock to other investors on the stock exchange for $121,000

(e) Issued $1,000 of additional common stock shares, and received cash from investors

Problem 3

Shown below are several transactions for a corporation and what accounts are affected. Using the given dollar amounts, explain in words the transaction that took place. Use the transactions to create a balance sheet.

(a) Cash = +$8,000, Contributed Capital = +$8,000

(b) Cash = +$42,000, Note payable (short-term) = + $42,000

(c) Cash = −$2,000, Equipment +$5,000, Note payable (short-term) = +$3,000

(d) Cash = −$6,000, Note receivable (short-term) = +6,000

(e) Cash = −$1,800, Supplies = +$1,800

Problem 4

Given below is the balance sheet for a company.

Balance Sheet (Millions of Dollars)

$18,550

Assets
Current Assets
Cash	$5,846
Short-term investments	518
Receivables and other assets	4,510
Inventories	607
Other	2,624
$14,105
Noncurrent Assets
Property, plant, and equipment	$1,594
Long-term investments	318
Other non-current assets	2,533
Total assets		$18,550
Liabilities and Stockholders’ Equity
Current Liabilities
Accounts payable	$5,816
Other short-term obligations	4,585
$10,401
Long-term Liabilities	$5,159
Stockholders’ equity
Contributed Capital	$7,832
Retained Earnings	14,690
Other stockholders’ equity items	−19,532
Total stockholders’ equity and liabilities

Assume the following transactions (in millions) during the remainder of the initial year.

(a) Borrowed $20 from banks due in two years

(b) Lent $170 to affiliates, who signed a six-month note

(c) Purchased additional investments for $6,000 cash; one-third were long term and the rest were short-term

(d) Purchased $1820 worth of property, plant, and equipment; paid $600 in cash and the remainder with additional long-term bank loans

(e) Issued additional shares of stock for $400 in cash

(f) Sold short-term investments costing $3,000 for $3,000 cash

(g) Declared and paid $13 in dividends during Year 1

Prepare a journal entry for each transaction. Then create T-accounts for each balance sheet account and include the new transactions. Post each journey entry to the appropriate T-accounts. Finally, create an updated balance sheet.