Required Organize the transaction data in accounts under an accounting equation.

Question

Required

Organize the transaction data in accounts under an accounting equation. (Do not round intermediate calculations. Enter any decreases to account balances with a minus sign. Select "NA" if there is no effect on the "Accounts Titles for Retained Earnings".)

The following post-closing trial balance was drawn from the accounts of Little Grocery Supplier (LGS) as of December 31 2017 Cash Accounts receivable Allowance for doubtful accounts Inventory Accounts payable Common stock Retained earnings S 9,000 41,000 $ 2,500 78,000 21,000 50,000 54, 500 Transactions for 2018 1. Acquired an additional $20,000 cash from the issue of common stock. 2. Purchased $85,000 of inventory on account. 3. Sold inventory that cost $91,000 for $160,000. Sales were made on account. 4. The company wrote off $900 of uncollectible accounts 5. On September 1, LGS loaned $18,000 to Eden Co. The note had an 8 percent interest rate and a one-year term 6. Paid $19,000 cash for operating expenses 7. The company collected $161,000 cash from accounts receivable 8. A cash payment of $92,000 was paid on accounts payable 9. The company paid a $5,000 cash dividend to the stockholders 10. Uncollectible accounts are estimated to be 1 percent of sales on account. 11. Recorded the accrued interest at December 31, 2018 (see item 5)

Explanation / Answer

Little grocery supplier Accounting equation Event Asset Liabilities stockholders equity Account title for retained earning cash +Accounts receivable - Allowance + Merchandise inventory + note receivable + interest receivable = Accounts payable +common stock + Retained earning Bal 9000 41000 2500 78000 21000 50000 54500 1 +20000 +20000 NA 2 +85000 +85000 3a +160000 +160000 revenue 3b -91000 -91000 expense 4 -900 -900 5 -18000 +18000 6 -19000 -19000 Expense 7 +161000 -161000 8 -92000 -92000 9 -5000 -5000 Dividend 10 +1600 -1600 expense 11 +480   [18000*.08*4/12] +480 revenue 56000 39100 3200 72000 18000 480 14000 70000 98380

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