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  3. assume down, inc., was organized on may 1 to compe

Assume Down, Inc., was organized on May 1 to compete with Despair, Inc.a company that...

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Accounting

Assume Down, Inc., was organized on May 1 to compete with Despair, Inc.a company that sells de-motivational posters and office products. Down, Inc., encountered the following events during its first month of operations.

  1. Received $43,000 cash from the investors who organized Down, Inc.
  2. Borrowed $16,000 cash and signed a note due in two years.
  3. Ordered equipment costing $25,000.
  4. Purchased $7,000 in equipment, paying $3,000 in cash and signing a six-month note for the balance.
  5. Received the equipment ordered in (c), paid for half of it, and put the rest on account.

Required:

  1. Summarize the financial effects of items (a)(e) in a table. (Enter any decreases to account balances with a minus sign.)

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