At the end of last month, Ajax Inc. had the following balancesin its accounts:Cash...At...

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Accounting

At the end of last month, Ajax Inc. had the following balancesin its accounts:
Cash $ 5,000
Inventory $10,000
Equipment $ 3,000
Land $10,000
Owe Jones $10,000
Common Stock $10,000
Retained Earnings $ 8,000
Set up the initial Balance Sheet for this month, make theappropriate entries for this month using the Accounting Equation,and show the ending Balance Sheet for this month. The followingshould be included for this month:
a. Buy inventory from Jones on credit for $10,000
b. Sell goods for $4,000
c. Sell common stock for $1,000
d. Pay wages of $2,000
e. Pay tax of $1,000
f. Sell goods to Smith on credit for $15,000
g. Pay rent of $100
h. Pay Jones $2,000
i. Depreciate equipment $200
j. Inventory at the end of the month is worth $7,000

Answer & Explanation Solved by verified expert

3.6 Ratings (443 Votes)

Initial Balance sheet of Ajax Inc for this Month Liabilities Amount in Assets Amount on Common Stock 10000 Land 10000 Retained Earnings 8000 Equipment 3000 Trade payables Jones 10000 Inventory 10000 Cash 5000 Total 28000 Total 28000 Accounting equations for the transactions during the period See Answer

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In: AccountingAt the end of last month, Ajax Inc. had the following balancesin its accounts:Cash...At the end of last month, Ajax Inc. had the following balancesin its accounts:Cash $ 5,000Inventory $10,000Equipment $ 3,000Land $10,000Owe Jones $10,000Common Stock $10,000Retained Earnings $ 8,000Set up the initial Balance Sheet for this month, make theappropriate entries for this month using the Accounting Equation,and show the ending Balance Sheet for this month. The followingshould be included for this month:a. Buy inventory from Jones on credit for $10,000b. Sell goods for $4,000c. Sell common stock for $1,000d. Pay wages of $2,000e. Pay tax of $1,000f. Sell goods to Smith on credit for $15,000g. Pay rent of $100h. Pay Jones $2,000i. Depreciate equipment $200j. Inventory at the end of the month is worth $7,000