Analyze the Effect of the Following Transactions Using the Basic

question 60

Essay

Analyze the effect of the following transactions using the basic accounting equation and the format provided below.
i. Bought land with an estimated fair value of $150,000 by issuing 100,000 shares.
ii. Issued 10,000 common shares for $15,000 cash
iii. Purchased a 2-year insurance policy for $4,800 .
iv. Paid rent of $3,000
v. Bought equipment for $50 ,000. Paid 20% down in cash and the balance on a 5-year, 6% note
payable.
vi. Purchased $9 ,000 of merchandise inventory on credit.
vii. Paid utilities bill for $750.
viii. Sold $8,000 of merchandise inventory for $16, 000 cash.
ix. Paid $2,500 on merchandise inventory previously purchased.
x. Declared a $1,000 dividend.
xi. Recognized that 1 month of the insurance coverage had expired.

FORMAT:

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Definitions:

Reinforcement

A concept in behaviorism that describes any stimulus which strengthens or increases the probability of a specific response.

Attention

Actively paying attention to a specific part of the environment, while omitting to notice other aspects.

Motor Reproduction

In the context of social learning theory, it refers to the physical ability to replicate the observed actions of a model.

Observational Learning

A learning process whereby individuals acquire new behaviors by watching and imitating others.