Matt's Computer Service Entered into the Following Transactions During Year

question 144

Essay

Matt's Computer Service entered into the following transactions during Year 1:
1)Issued stock to investors for $45,000 cash2)Purchased land for $36,000 cash3)Performed services on account for $51,0004)Collected $33,600 from customers on account5)Paid $19,500 cash for operating expenses
Required:a)Draw T-accounts and post the above transactions to the appropriate T-accounts.b)Prepare a balance sheet for Matt's Computer Service for December 31, Year 1.

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Definitions:

Raw Materials

Basic materials and components that are used in the manufacturing process to produce finished goods.

Journal Entries

Records in accounting that document financial transactions and their impact on the accounts of an organization in a chronological order.

Indirect Materials

are materials used in the production process, but not directly traceable to a finished product, like lubricants for machinery.

Direct Materials

Direct materials are raw materials that are directly used in the manufacturing process of a product and are a major component of the cost of goods sold.