The Following Events Are for Leisure Travel Services for the Year

question 10

Essay

The following events are for Leisure Travel Services for the year 2013, the first year of operations. Assume that all transactions involve the receipt or payment of cash.
1) The business acquired $40,000 from stock issued to owners.
2) Creditors loaned the company $17,500.
3) The company provided services to its customers and received $55,400.
4) The company paid expenses amounting to $43,250.
5) The company purchased land for $29,000.
6) The company paid a dividend of $5,000 to its owners.
Required:
a) Show the effects of the above transactions on the accounting equation (use appropriate element and account headings). For those events that affect retained earnings, indicate in a separate column the appropriate temporary account. Accounting Equation:
Event No.
1)
2)
3)
4)
5)
6)
Totals
b) Prepare an income statement and balance sheet for the year 2013.

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Definitions:

Nepotism

The practice of hiring relatives.

Self-Selection

The process where individuals choose to participate in or withdraw from activities or opportunities based on their preferences, interests, or perceived skills.

Job Advertisements

Public or internal postings by employers seeking to fill positions, outlining the job responsibilities, required qualifications, and application process.

Realistic Job Previews

A technique used in the employee selection process that provides potential candidates with a true picture of what performing the job would be like to reduce turnover and ensure a good fit.