Question

Problem 2 Dwayne Kent on Jan 1, 20X1, opened the Double K Inn, a ten-room lodging facility. During the first three days the following transactions were completed a)He invested S50,000 of his personal cash in a bank account opened in the name of Double K Inn. b)He paid S2,000 for the month of January to lease a building containing the ten guest-rooms c)He rented rooms for the three days and collected an average of S50 per room for the 15 rooms that were "sold". Treat this activity as a single transaction to keep things simple. d)He purchased guest supplies on account from Hotel Supplies, Inc., for S300. e)He paid an advertising bill of S500. Required Arrange the following asset, liability, and proprietorship titles in an expanded accounting equation like that shown in the chapter: Cash, Guest Supplies, Prepaid Rent, Accounts Payable, and Dwayne Kent, Capital. Show by additions and subtractions the effects of each transaction on the assets, liabilities, and proprietorship of Double K Inn. Show net totals for all items after each transaction 1. 2.

Answer 1