Signs an agreement to manufacture a specially designed

Reference no: EM13586908

Texas Product Corporation begins operation on April 1, 2012. The firm engages in the following transaction during April.

(1) Issues 20,000 shares of $5 par value common stock for $12 per share in cash.

(2) Issues 5,000 shares of $100 par value preferred stock at par value for cash.

(3) Gives $40,000 in cash and 5,000 shares of common stock in exchange for land and a building. The land appears at $25,000 and the building at $75,000 on the balance sheet.

(4) Acquires equipment costing $46,000. It makes cash payment of $8,000 and gives an 8% notes due in one year, for the balance.

(5) Pays transportation cost of $1,200 on equipment in (4).

(6) Pays installation cost of $1,800 on the equipment in (4).

(7) Acquire merchandise inventory costing $60,000 on account.

(8) Pays license fees of $1,300 for the year beginning May 1 in advance.

(9) Discovers that merchandise costing $1,900 from the acquisition in (7) is defective and returns it to the supplier for credit. The firm has not yet paid this account.

(10) Purchase a patent from its creator for $30,000.

(11) Signs an agreement to manufacture a specially designed machine for a customer for $60,000 to be delivered in January of next year. At the time of signing, the customer advances $12,000 of the contract price.

(12) Pays invoices totaling $40,000 from the purchases in (7).

Required:

a. Prepare journal entries and enter the transactions in T-accounts. Indicate whether each account is an asset, a liability, or a stockholder's equity item.

b. Prepare a balance sheet for Texas Product Corporation as of April 30, 2012.

Reference no: EM13586908

Questions Cloud

Office supplies had a balance of 192 on january 1 during : office supplies had a balance of 192 on january 1. during the year 785 of office supplies were purchased on account. at

Most people have some exposure to an accounting information : most people have some exposure to an accounting information system but not all people have the same exposure or

Auditors found out that campbell was delaying payments to : auditors found out that campbell was delaying payments to creditors at year end and selling inventories as huge

Isabel lopez started biz consulting a new business and : isabel lopez started biz consulting a new business and completed the following transactions during its first year of

Signs an agreement to manufacture a specially designed : texas product corporation begins operation on april 1 2012. the firm engages in the following transaction during

Tomas corporation began operations at the start of 20c : tomas corporation began operations at the start of 20c. during the year it made sales totaling 875000 and collected

Equipment was purchased at a cost of 57620 and fully : the comparative balance sheet of amelia enterprises inc. at december 31 2014 and 2013 is as followsdec. 31 2014dec. 31

Acme sales has two store locations store a has fixed costs : acme sales has two store locations. store a has fixed costs of 125000 per month and a variable cost ratio of 60. store

Jones corporation owns 10 of the common stock of sayles : jones corporation owns 10 of the common stock of sayles company as a result of a stock purchase on january 1 2010 and

User Account

All Pages