Chapter 1 Notes Financial Accounting

Chapter 1
Financial Statements and Business Decisions

EXERCISES

E1–2

Req. 1
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Balance Sheet
As at December 31, 2008

|ASSETS | |LIABILITIES AND SHAREHOLDERS’ EQUITY | |
| | |Liabilities | |
|Cash |$ 48,900 |Accounts payable |$ 7,000 |
|Accounts receivable |25,000 |Note payable |3,000 |
|Store and office equipment |49,000 |Interest payable |120 |
| | | Total liabilities |10,120 |
| | | | |
| | |Shareholders’ Equity | |
| | |Share capital |100,000 |
| | |Retained earnings |12,780 |
| | | Total shareholders’ equity |112,780 |
| | |Total liabilities and | |
|Total assets |$122,900 |shareholders' equity