Question

Required information [The following information applies to the questions displayed below.] Mark’s Consulting experienced the following transactions for 2018, its first year of operations, and 2019. Assume that all transactions involve the receipt or payment of cash. Transactions for 2018 Acquired $50,000 by issuing common stock. Received $100,000 cash for providing services to customers. Borrowed $15,000 cash from creditors. Paid expenses amounting to $60,000. Purchased land for $40,000 cash. Transactions for 2019 Beginning account balances for 2019 are: Cash $ 65,000 Land 40,000 Notes payable 15,000 Common stock 50,000 Retained earnings 40,000 Acquired an additional $20,000 from the issue of common stock. Received $130,000 for providing services. Paid $10,000 to creditors to reduce loan. Paid expenses amounting to $75,000. Paid a $15,000 dividend to the stockholders. Determined that the market value of the land is $50,000. Required Record the effects of each accounting event under the appropriate headings for each year. Record the amounts of revenue, expense, and dividends in the Retained Earnings column. Provide appropriate titles for these accounts in the last column of the table.

Record the effects of each accounting event under the appropriate headings for the year 2018. Record the amounts of revenue, expense, and dividends in the Retained Earnings column. Provide appropriate titles for these accounts in the last column of the table. (Enter any decreases to account balances with a minus sign. If there is no effect on the Account Titles for Retained Earnings, leave the cell blank. Not all cells will require input.)

MARK'S CONSULTING
Accounting Equation for 2018
Event	Assets			=	Liabilities	+	Stockholders’ Equity			Account Titles for Retained Earnings
	Cash	+	Land	=	Notes Payable	+	Common Stock	+	Retained Earnings
1.		+		=		+		+
2.		+		=		+		+
3.		+		=		+		+
4.		+		=		+		+
5.		+		=		+		+
Totals	0	+	0	=	0	+	0	+	0

Answer 1

MARK'S CONSULTING
Accounting Equation for 2018
Event	Assets			=	Liabilities	+	Stockholders’ Equity			Account Titles for Retained Earnings
	Cash	+	Land	=	Notes Payable	+	Common Stock	+	Retained Earnings
1	50000	+		=		+	50000	+
2	100000	+		=		+		+	100000	Service Revenue
3	15000	+		=	15000	+		+
4	-60000	+		=		+		+	-60000	Expenses
5	-40000	+	40000	=		+		+
Totals	65000	+	40000	=	15000	+	50000	+	40000