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    I 02.08problem

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    avi
    This document provides a series of 10 transactions for Bingo Corporation and asks the reader to use T-accounts to record the transactions, prepare a trial balance, and resulting financial statements including an income statement, statement of retained earnings, and balance sheet. It also asks the reader to comment on whether T-accounts would provide a sufficient data processing system on their own.

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    I 02.08problem

    Uploaded by

    avi
    614 views1 page
    This document provides a series of 10 transactions for Bingo Corporation and asks the reader to use T-accounts to record the transactions, prepare a trial balance, and resulting financial statements including an income statement, statement of retained earnings, and balance sheet. It also asks the reader to comment on whether T-accounts would provide a sufficient data processing system on their own.

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    I 02.08Problem

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    This document provides a series of 10 transactions for Bingo Corporation and asks the reader to use T-accounts to record the transactions, prepare a trial balance, and resulting financial statements including an income statement, statement of retained earnings, and balance sheet. It also asks the reader to comment on whether T-accounts would provide a sufficient data processing system on their own.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    614 views1 page

    I 02.08problem

    Uploaded by

    avi
    This document provides a series of 10 transactions for Bingo Corporation and asks the reader to use T-accounts to record the transactions, prepare a trial balance, and resulting financial statements including an income statement, statement of retained earnings, and balance sheet. It also asks the reader to comment on whether T-accounts would provide a sufficient data processing system on their own.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    Using T-accounts to evaluate business activity

    Problem I-01.05 provided the following data for Bingo Corporation. In that problem, financial statements
    were prepared after each transaction. This problem requires you to use T-accounts to capture the transactions and produce a final set of financial statements.
    (1)

    Issued capital stock for $50,000 cash.

    (2)

    Purchased building for $120,000, making a $20,000 down payment and signing a promissory note
    payable for the balance.

    (3)

    Paid wages expense of $5,000.

    (4)

    Provided services to customers for $15,000 cash.

    (5)

    Paid utilities expense of $2,000.

    (6)

    Reduced note payable with an $8,000 cash payment (ignore interest costs).

    (7)

    Provided services to customers on account, $10,000.

    (8)

    Incurred wages expense of $3,000, to be paid in the future.

    (9)

    Collected $4,000 on an outstanding account receivable.

    (10) Declared and paid dividend of $6,000.

    (a)

    Prepare T-accounts for the above transactions.

    (b)

    Prepare the resulting trial balance.

    (c)

    Prepare the income statement, statement of retained earnings, and balance sheet that results from
    these 10 transactions.

    (d)

    Comment on the value of an information processing system. Would T-accounts provide a sufficient
    data processing system?

    I-02.08

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