0.50 points The following events occurred for Johnson Company: a. Received inves

Question

0.50 points The following events occurred for Johnson Company: a. Received investment of $40,000 cash by organizers and distributed 1,080 shares of $1 par value common stock to them. b. Purchased $8,700 of equipment, paying $1,100 in cash and signing a note for the rest. c. Borrowed $10,000 cash from a bank. d. Loaned $1,200 to an employee who signed a note. e. Purchased $20,594 of land; paid $6,000 in cash and signed a mortgage note for the balance. Required For each of the events (a) through (e), perform transaction analysis and indicate the account, amount, and direction of the effect for increase and - for decrease) on the accounting equation. Check that the accounting equation remains in balance after each transaction. (f no impact on accounting equation leave cells blank.) Transaction Assets Liabilities Stockholders' Equity a. b. C. d.

Explanation / Answer

Table Showing Transaction Analysis (Amounts in $)

Transaction Assets = Liabilities + Stockholder's  Equity a. Cash +40,000 Common Stock (1,080*$1) +1,080 Additional Paid in Capital (Bal fig) (40,000-1,080) +38,920 b. Equipment +8,700 Notes Payable (8,700-1,100) +7,600 Cash -1,100 c. Cash +10,000 Notes Payable +10,000 d. Notes Receivable +1,200 Cash -1,200 e. Land +20,594 Mortgage Notes Payable (20,594-6,000) +14,594 Cash -6,000

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