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Chapter 2: Measurement Concepts: Recording Business Transactions




Question;129. What;are the steps in the posting process for the debit side of an entry?;130. Discuss;the difference between business events that are transactions and those that are;not. Why is the distinction important?;131. Ironwood;Company has just started operations. The company sold 5,000 shares of;common stock to investors for $10,000 to get the business started. The;company has made several sales on account, but has not yet collected any cash;from these sales. At this point, Ironwood?s cash flows for expenses are;exceeding its cash flows from revenues. How might Ironwood make up the;difference so it can maintain its liquidity?;132. Using;the following transactions, calculate (A) the ending balance of Cash, (B) the;ending balance of Accounts Receivable, (C) total liabilities, and (D);Stockholders? Equity at the end of the period. For parts a, b, and d, indicate;whether each balance is debit or credit.;a. Began doing business by selling shares of common stock to investors for;$50,000 in cash.;b. Billed customers for services rendered, $10,000.;c. Paid for six months' subscription in advance, $2,500.;d. Received advertising bill, to be paid next week, $500.;e. Dividends of $4,000 were paid to common stock holders.;f. Received $7,500 from customers billed in b.;g. Paid half of advertising bill.;h. Received $1,000 in advance of performing a service.


Paper#55140 | Written in 18-Jul-2015

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