70.2K

Verified Solution

Link Copied!

Required information CC2-1 (Algo) Accounting for the Establishment of a Business [LO 2-1, LO 2-2, LO 2-3, LO 2-4, LO 2-5] [The following information applies to the questions displayed below.] Nicole has decided that she is going to start her business, Nicole's Getaway Spa (NGS). A lot has to be done when starting a new business. Here are some transactions that have occurred prior to April 30. a. Received $84,000 cash when issuing 8,400 new common shares. b. Purchased land by paying $4,000 cash and signing a note payable for $5,500 due in three years. c. Hired a new aesthetician for a salary of $1,400 a month, starting next month. d. NGS purchased a company car for $22,000 cash (list price of $25,000 ) to assist in running errands for the business. e. Bought and received $950 in supplies for the spa on credit. f. Paid $130 of the amount owed in (e). g. Nicole sold 100 of her own personal shares to Raea Gooding for $700. CC2-1 (Algo) Part 1 Required: 1. Prepare journal entries for each of the entries. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) Journal entry worksheet 34567 Received $84,000 cash when issuing 8,400 new common shares. Record the transaction. Note: Enter debits before credits. 2. Assuming that the beginning balances in each of the accounts are zero, complete T-accounts to summarize the transactions in (a)-(g). 3. Prepare a classified balance sheet at April 30 using the information given in the transactions. Include Retained Earnings with a zero balance. 4. Calculate the current ratio at April 30

Answer & Explanation Solved by verified expert

See Answer