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    The Following Is A List of Possible Transactions 1 Purchased Inventory PDF

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    Taimur Technologist
    The document lists 20 possible transactions for a company. Transaction 1 is to purchase inventory #1190. The full document provides more details on each transaction, such as purchasing inventory on account, borrowing money from a bank, recording sales, expenses, accruals, and more. It instructs the reader to analyze the effects of each transaction on different financial statement line items.

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    The Following Is A List of Possible Transactions 1 Purchased Inventory PDF

    Uploaded by

    Taimur Technologist
    60 views2 pages
    The document lists 20 possible transactions for a company. Transaction 1 is to purchase inventory #1190. The full document provides more details on each transaction, such as purchasing inventory on account, borrowing money from a bank, recording sales, expenses, accruals, and more. It instructs the reader to analyze the effects of each transaction on different financial statement line items.

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    The document lists 20 possible transactions for a company. Transaction 1 is to purchase inventory #1190. The full document provides more details on each transaction, such as purchasing inventory on account, borrowing money from a bank, recording sales, expenses, accruals, and more. It instructs the reader to analyze the effects of each transaction on different financial statement line items.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    60 views2 pages

    The Following Is A List of Possible Transactions 1 Purchased Inventory PDF

    Uploaded by

    Taimur Technologist
    The document lists 20 possible transactions for a company. Transaction 1 is to purchase inventory #1190. The full document provides more details on each transaction, such as purchasing inventory on account, borrowing money from a bank, recording sales, expenses, accruals, and more. It instructs the reader to analyze the effects of each transaction on different financial statement line items.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 2

    The following is a list of possible transactions 1

    Purchased inventory #1190

    The following is a list of possible transactions.

    1. Purchased inventory for $80,000 on account (assume perpetual system is used).

    2. Issued an $80,000 note payable in payment of an account (see item 1 above).

    3. Recorded accrued interest on the note from item 2 above.

    4. Borrowed $100,000 from the bank by signing a $112,000, six-month, non-interest-bearing


    note.

    5. Recognized four months of interest expense on the note from item 4 above.

    6. Recorded cash sales of $75,260, which includes 6% sales tax.

    7. Recorded salaries and wages expense of $35,000. The cash paid was $25,000; the
    difference was due to various amounts withheld.

    8. Recorded employer's payroll taxes.

    9. Accrued accumulated vacation pay.

    10. Signed a $2-million contract with Construction Corp. to build a new plant.

    11. Recorded bonuses due to employees.

    12. Recorded a provision on a lawsuit that the company will probably lose.

    13. Accrued warranty expense (assume expense approach).

    14. Paid warranty costs that were accrued in item 13 above.

    15. Recorded sales of product and separately sold warranties.

    16. Paid warranty costs under contracts from item 15 above.

    17. Recognized warranty revenue (see item 15 above).

    18. Recorded estimated liability for premium claims outstanding.

    19. Recorded the receipt of a cash down payment on services to be performed in the next
    1/2
    accounting period.

    20. Received the remainder of the contracted amount and performed the services related to
    item 19 above.

    Instructions

    Set up a table using the format that follows and, using ASPE, analyze the effects of the 20
    transactions on the financial statement categories in the table. Use the following codes:
    increase (I), decrease (D), or no net effect (NE).

    The following is a list of possible transactions 1 Purchased inventory

    ANSWER
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