Bailey Delivery Company, Incorporated, was organized in 2021 in Wisconsin. The following transactions occurred during the year: a. Received cash from investors in exchange for 16,000 shares of stock (par value of $1.00 per share) with a market value of $8 per share. b. Purchased land in Wisconsin for $20,000, signing a one-year note (ignore interest). c. Bought two used delivery trucks for operating purposes at the start of the year at a cost of $15,000 each; paid $6,000 cash and signed a note due in three years for the rest (ignore interest). d. Paid $2,400 cash to a truck repair shop for a new motor for one of the trucks. (Increase the account you used to record the purchase of the trucks because the productive life of the truck has been improved) e. Sold one-fourth of the land for $5,000 to Pablo Development Corporation, which signed a six-month note. f. Stockholder Helen Bailey paid $29,500 cash for a vacant lot (land) in Canada for her personal use. 3. Prepare a classified balance sheet for Bailey Delivery Company at December 31, 2021. Current assets: Total current assets Non-current assets: Total non-current assets Total assets Assets BAILEY DELIVERY COMPANY, INCORPORATED Balance Sheet 0 Current liabilities: Liabilities Total current liabilities Total liabilities Stockholders' Equity 0 Total stockholders' equity 0 Total liabilities and stockholders' equity 0 0 0 0
Bailey Delivery Company, Incorporated, was organized in 2021 in Wisconsin. The following transactions occurred during the year: a. Received cash from investors in exchange for 16,000 shares of stock (par value of $1.00 per share) with a market value of $8 per share. b. Purchased land in Wisconsin for $20,000, signing a one-year note (ignore interest). c. Bought two used delivery trucks for operating purposes at the start of the year at a cost of $15,000 each; paid $6,000 cash and signed a note due in three years for the rest (ignore interest). d. Paid $2,400 cash to a truck repair shop for a new motor for one of the trucks. (Increase the account you used to record the purchase of the trucks because the productive life of the truck has been improved) e. Sold one-fourth of the land for $5,000 to Pablo Development Corporation, which signed a six-month note. f. Stockholder Helen Bailey paid $29,500 cash for a vacant lot (land) in Canada for her personal use. 3. Prepare a classified balance sheet for Bailey Delivery Company at December 31, 2021. Current assets: Total current assets Non-current assets: Total non-current assets Total assets Assets BAILEY DELIVERY COMPANY, INCORPORATED Balance Sheet 0 Current liabilities: Liabilities Total current liabilities Total liabilities Stockholders' Equity 0 Total stockholders' equity 0 Total liabilities and stockholders' equity 0 0 0 0
SWFT Essntl Tax Individ/Bus Entities 2020
23rd Edition
ISBN:9780357391266
Author:Nellen
Publisher:Nellen
Chapter18: Comparative Forms Of Doing Business
Section: Chapter Questions
Problem 1BD
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Transcribed Image Text:Bailey Delivery Company, Incorporated, was organized in 2021 in Wisconsin. The following transactions occurred during
the year:
a. Received cash from investors in exchange for 16,000 shares of stock (par value of $1.00 per share) with a market
value of $8 per share.
b. Purchased land in Wisconsin for $20,000, signing a one-year note (ignore interest).
c. Bought two used delivery trucks for operating purposes at the start of the year at a cost of $15,000 each; paid
$6,000 cash and signed a note due in three years for the rest (ignore interest).
d. Paid $2,400 cash to a truck repair shop for a new motor for one of the trucks. (Increase the account you used to
record the purchase of the trucks because the productive life of the truck has been improved)
e. Sold one-fourth of the land for $5,000 to Pablo Development Corporation, which signed a six-month note.
f. Stockholder Helen Bailey paid $29,500 cash for a vacant lot (land) in Canada for her personal use.
3. Prepare a classified balance sheet for Bailey Delivery Company at December 31, 2021.
Current assets:
Total current assets
Non-current assets:
Total non-current assets
Total assets
Assets
BAILEY DELIVERY COMPANY, INCORPORATED
Balance Sheet
0
Current liabilities:
Liabilities
Total current liabilities
Total liabilities
Stockholders' Equity
0 Total stockholders' equity
0 Total liabilities and stockholders' equity
0
0
0
0
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