Bearings & Brakes Corporation was incorporated as a private company. The company

Question

Bearings & Brakes Corporation was incorporated as a private company. The company’s accounts included the following at June 30: Accounts Payable $85,099 Building 620,000 Cash 102, 000 Common Stock 290,009 Equipment 172,000 Land 504, 000 Notes Payable (long-term) 5,000 Retsined Earnings 1,026,000 Supplies 8,000 During the month of July, the company had the following activities: a. Issued 4,109 shares of common stock for $410,009 cash. b. Borrowed $120,000 cash from a local bank, payable in four years. c. Bought a building for $190,000; paid $78,000 in cash and signed a three-year note for the balance. d. Paid cash for equipment that cost $102,000 e. Purchased supplies for $102,000 on Account. Analyze transactions (a)-(e) to determine their effects on the accounting equation. (Enter any decreases to account balances with a minus sign.). Assets, Liabilities, Stockholders’ Equity Bearings & Brakes Corporation was incorporated as a private company. The company’s accounts included the following at June 30: Accounts Payable $85,099 Building 620,000 Cash 102, 000 Common Stock 290,009 Equipment 172,000 Land 504, 000 Notes Payable (long-term) 5,000 Retsined Earnings 1,026,000 Supplies 8,000 During the month of July, the company had the following activities: a. Issued 4,109 shares of common stock for $410,009 cash. b. Borrowed $120,000 cash from a local bank, payable in four years. c. Bought a building for $190,000; paid $78,000 in cash and signed a three-year note for the balance. d. Paid cash for equipment that cost $102,000 e. Purchased supplies for $102,000 on Account. Analyze transactions (a)-(e) to determine their effects on the accounting equation. (Enter any decreases to account balances with a minus sign.). Assets, Liabilities, Stockholders’ Equity Bearings & Brakes Corporation was incorporated as a private company. The company’s accounts included the following at June 30: Accounts Payable $85,099 Building 620,000 Cash 102, 000 Common Stock 290,009 Equipment 172,000 Land 504, 000 Notes Payable (long-term) 5,000 Retsined Earnings 1,026,000 Supplies 8,000 During the month of July, the company had the following activities: a. Issued 4,109 shares of common stock for $410,009 cash. b. Borrowed $120,000 cash from a local bank, payable in four years. c. Bought a building for $190,000; paid $78,000 in cash and signed a three-year note for the balance. d. Paid cash for equipment that cost $102,000 e. Purchased supplies for $102,000 on Account. Analyze transactions (a)-(e) to determine their effects on the accounting equation. (Enter any decreases to account balances with a minus sign.). Assets, Liabilities, Stockholders’ Equity

Explanation / Answer

Transaction Explanation Assets Liabilitites Stockholders equity a Equity issued (increase) and cash received (increase) 410009 410009 b Cash received (increase) and Bank loan Liability (increase) 120000 120000 c Building (Asset) increases , cash is paid so assets falls and net notes payable liability increases =190000-78000=112000 112000 d Equipment increase is set off by cash paid e Inventory increases on purchases as well as creditors as it is on a/c 102000 102000 Please hit the like button if the answer helped you else leave a comment for further clarification. Thank you! All the best!

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