GROUP A PROBLEMS PA10-1 Determining Financial Effects of Transactions Affecting Current Liabilities with Evaluation of Effects on the Debt-to-Assets Ratio Jack Hammer Company completed the following transactions. The annual accounting period ends December 31. Apr. 30 June 6 July 15 Aug. 31 Dec. 31 Dec. 31 Dec. 31 Received $600,000 from Commerce Bank after signing a 12-month, 6 percent, promissory note. Purchased merchandise on account at a cost of $75,000. (Assume a perpetual inventory system.) Paid for the June 6 purchase. Signed a contract to provide security service to a small apartment complex starting in September, and collected six months' fees in advance, amounting to $24,000. Determined salary and wages of $40,000 were earned but not yet paid as of December 31 (ignore payroll taxes). Adjusted the accounts at year-end, relating to interest. Adjusted the accounts at year-end, relating to security service.

GROUP A PROBLEMS PA10-1 Determining Financial Effects of Transactions Affecting Current Liabilities with Evaluation of Effects on the Debt-to-Assets Ratio Jack Hammer Company completed the following transactions. The annual accounting period ends December 31. Apr. 30 June 6 July 15 Aug. 31 Dec. 31 Dec. 31 Dec. 31 Received $600,000 from Commerce Bank after signing a 12-month, 6 percent, promissory note. Purchased merchandise on account at a cost of $75,000. (Assume a perpetual inventory system.) Paid for the June 6 purchase. Signed a contract to provide security service to a small apartment complex starting in September, and collected six months' fees in advance, amounting to $24,000. Determined salary and wages of $40,000 were earned but not yet paid as of December 31 (ignore payroll taxes). Adjusted the accounts at year-end, relating to interest. Adjusted the accounts at year-end, relating to security service.

Century 21 Accounting Multicolumn Journal

11th Edition

ISBN:9781337679503

Author:Gilbertson

Publisher:Gilbertson

Chapter18: Acquiring Capital For Growth And Development

Section18.2: Long-term Debt Financing

Problem 1OYO

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