The following transactions occurred during March 2021 for the Wainwright Corporation. The company owns and operates a wholesale warehouse. Issued 22,000 shares of common stock in exchange for $220,000 in cash.
Purchased equipment at a cost of $24,000. $6,000 cash was paid and a notes payable to the seller was signed for the balance owed.
Purchased inventory on account at a cost of $68,000. The company uses the perpetual inventory system.
Credit sales for the month totaled $80,000. The cost of the goods sold was $48,000.
Paid $3,250 in rent on the warehouse building for the month of March.
Paid $5,350 to an insurance company for fire and liability insurance for a one-year period beginning April 1, 2021.
Paid $48,000 on account for the merchandise purchased in 3.
Collected $36,000 from customers on account.
Recorded depreciation expense of $600 for the month on the equipment.
Required:
Analyze each transaction and show the effect of each on the accounting equation for a corporation. (Amounts to be deducted should be indicated by a minus sign. Enter the net change on the accounting equation.)
Paid-In Capital Retained Earnings Assets Liabilities + 220,000 1 220,000 2. 3 4. 5 6 7. 8 9 LC