Question:
At the beginning of 2013, Foster Corp.%u2019s accounting records had the following general ledger accounts and balances.
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FOSTER CORP.
Accounting Equation
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|
Event
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Assets
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=
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Liabilities
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+
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Stockholder%u2019s Equity
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Acct. Titles
for RE
|
| |
Cash
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Land
|
|
Notes
Payable
|
|
Common
Stock
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Retained
Earnings
|
|
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Balance
1/1/2013
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30,000
|
16,000
|
|
10,000
|
|
20,000
|
16,000
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|
Foster Corp. completed the following transactions during 2013:
1. Purchased land for $20,000 cash.
2. Acquired $10,000 cash from the issue of common stock.
3. Received $90,000 cash for providing services to customers.
4. Paid cash operating expenses of $65,000.
5. Borrowed $20,000 cash from the bank.
6. Paid a $5,000 cash dividend to the stockholders.
7. Determine that the market value of the land purchased in event 1 is $30,000.