Pinehurst Company Was Formed in Year 1 and Experienced the Following

question 127

Essay

Pinehurst Company was formed in Year 1 and experienced the following accounting events during the year:
Issued common stock for $15,000 cash.Earned cash revenue of $28,000.Paid cash expenses of $20,500. These were the only events that affected the company during the year.
Required: Write the accounting equation and record the effects of each accounting event under the appropriate general ledger account heading. Enter 0 for items not affected.Prepare an income statement for Year 1 and a balance sheet as of December 31, Year 1.

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Definitions:

Legally Required Insurance

Insurance policies that businesses are mandated to have by law to cover potential damages or liabilities.

Short-term Disability Plans

Insurance plans that provide employees with income for a brief period during which they are unable to work due to illness or injury.

Paramedical Expense Coverage

Insurance coverage that pays for medical services outside of traditional hospital care, such as physiotherapy, acupuncture, and massage therapy.

Indirect Compensation

Compensation that is not paid directly as cash to an employee but instead provides value in other forms such as insurance, stock options, or retirement plans.