Early in its fiscal year ending December 31, 2021, Morgan Manufacturing, Inc. (MMI) finalized plans to expand operations. The first stage was completed on March 28 with the purchase of a tract of land on the outskirts of the city. The land and existing building were purchased by paying $340,000 immediately and signing a noninterest-bearing note requiring the company to pay $740,000 on December 31, 2023. An interest rate of 6% properly reflects the time value of money for this type of loan agreement. Title search, insurance, and other closing costs totaling $34,000 were paid at closing. At the end of April, the old building was demolished at a cost of $84,000, and an additional $64,000 was paid to clear and grade the land. MMI should record the land on the April 30 balance sheet as $[land].

Presented below is a list of possible transactions. analyze the effect of the 18 transactions on the financial statement categories indicated. transactions assets liabilities owners’ equity net income 1. purchased inventory for $80,000 on account (assume perpetual system is used). 2. issued an $80,000 note payable in payment on account (see item 1 above). 3. recorded accrued interest on the note from item 2 above. 4. borrowed $100,000 from the bank by signing a 6-month, $112,000, zero-interest-bearing note. 5. recognized 4 months’ interest expense on the note from item 4 above. 6. recorded cash sales of $75,260, which includes 6% sales tax. 7. recorded wage expense of $35,000. the cash paid was $25,000; the difference was due to various amounts withheld. 8. recorded employer’s payroll taxes. 9. accrued accumulated vacation pay. 10. recorded an asset retirement obligation. 11. recorded bonuses due to employees. 12. recorded a contingent loss on a lawsuit that the company will probably lose. 13. accrued warranty expense (assume expense warranty approach). 14. paid warranty costs that were accrued in item 13 above. 15. recorded sales of product and related service-type warranties. 16. paid warranty costs under contracts from item 15 above. 17. recognized warranty revenue (see item 15 above). 18. recorded estimated liability for premium claims outstanding.

4. the condition requires that only one of the selected criteria be true for a record to be displayed.

Imagine you own an established startup with growing profits. you are looking for funding to greatly expand company operations. what method of financing would be best for you?