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ACCT 382 - Week 2 - Chapter 2 Homework - Question 2

ACCT 382 - Week 2 - Chapter 2 Homework - Question 2
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ACCT 382 - Week 2 - Chapter 2 Homework - Question 2

Question 2

The following transactions occurred during March 2013 for the Wainwright Corporation. The company owns and operates a wholesale warehouse.

a.

Issued 30,000 shares of common stock in exchange for $300,000 in cash.

b.

Purchased equipment at a cost of $40,000. $10,000 cash was paid and a note payable was signed for the balance owed.

c.

Purchased inventory on account at a cost of $90,000. The company uses the perpetual inventory system.

d.

Credit sales for the month totaled $120,000. The cost of the goods sold was $70,000.

e.

Paid $5,000 in rent on the warehouse building for the month of March.

f.

Paid $6,000 to an insurance company for fire and liability insurance for a one-year period beginning April 1, 2013.

g.

Paid $70,000 on account for the merchandise purchased in transaction c.

h.

Collected $55,000 from customers on account.

i.

Recorded depreciation expense of $1,000 for the month on the equipment.

Prepare journal entries to record each of the transactions listed above. (If no entry is required for a particular transaction, select "No journal entry required" in the first account field.)