Reference no: EM133165233

Question - Lee Delivery Company Inc. (LDC) was incorporated January 1. The following transactions occurred during the year:

a. Received $40,000 cash from organizers In exchange for shares in the new company.

b. Purchased land for $12 000 signing a two-year note (Ignore interest).

c. Bought two used delivery trucks at the start of the year at a cost of $10,000 each; paid $2,000 cash and signed a note due three years for the rest (Ignore interest).

d. Paid $2,000 cash to a truck repair shop for a new motor, which increased the cost of one of the trucks.

e. Shareholder Jonah Lee paid $122,000 cash for a house for his personal use.

Required - Analyze each item for its effects on the accounting equation of LDC, for the year ended December 31. (The new motor in transaction (d) is treated as an Increase to the cost of the truck).