Federal Taxes and Management Decision Essay

655 WordsMar 24, 20133 Pages
EXERCISE 10-1: Item Land Land Building Other Accounts Improvements A ($275,000) Notes Payable B $275,000 C $ 10,000 D 7,000 E 6,000 F (1,000) G 25,000 H 250,000 I 9,000 J $ 4,000 K 11,000 L (5,000) M 13,000 N 19,000 O 14,000 P 3,000 EXERCISE 10-3: 1) Truck #1 13,900 Cash 13,900. 2) Truck #2 18,364* Discount on Notes Payable 1,636 Cash 2,000 Notes Payable 18,000 3) Truck #3 15,200 Cost of Goods Sold 12,000 Inventory 12,000 Sales 15,200 4) Truck #4 13,000 Common Stock 10,000 Paid-in Capital in Excess of Par (1,000 shares X $13 = $13,000; $13,000 less $10,000 par value) 3,000 EXERCISE 10-4: Purchase Cash paid for equipment, including sales tax of $5,000 $105,000 Freight and insurance while in transit 2,000 Cost of moving equipment into place at factory 3,100 Wage cost for technicians to test equipment 6,000 Special plumbing fixtures required for new equipment 8,000 Total cost $124,100 Construction Material and purchased parts ($200,000 X .99)
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