Mother Hips Garment Company purchased equipment on June 1 for $90,000, paying $2

Question

Mother Hips Garment Company purchased equipment on June 1 for $90,000, paying $2C,000 cash and signing a 9% 2-month note for the remaining balance. The equipment is expected to depreciate s 18,000 each year. Mother Hips Garment Company prepares monthly financial statements. Prepare the general journal entry to record the acquisition of the equipment on June 1st Entry for the account titles and enter 0 for the amounts.) for the Credit account titles are utomatically indented when the armount is entered. Do not indent manually. If no entry ts required, select No Date Account Titles and Explanation Debit Credit una 1 Prapare any adjusting ournal entries that should be made on June 30th. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter o for the amounts.) Date Account Titles and Explanation Debit Cradit une 30 Te record monthly decreciation) une 30 To acrre interest an nctes p payahle) Show how the equipment will be reflected on Mother Hips Garment Company's balance sheet on June 30th. Mother Hips Garment Company's Partial Balance Sheet Assets

Explanation / Answer

Solution:

Journal Entries - Mother Hips Garment Company Date Particulars Debit Credit 1-Jun Equipment Dr $90,000       To Cash $20,000       To Notes Payable $70,000 (To record purchase of equipment)

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