Preparation of Entries for Reconciliation

Debit Credit
a. Operating - Decrease in Accounts Receivable 10,000
Accounts Payable 10,000
b. Inventory 5,000
Operating - Increase inInventory 5,000
c. Prepaid Expenses 4,000
Operating - Increase in Prepaid Expenses 4,000
110,00
d. Land 0
110,00
Bonds Payable 0
120,00
e. Building 0
120,00
Investing - Purchase in Equipment 0
f. Equipment 25,000
Investing - Purchase in Equipment 25,000
g. Investing - Sale of Equipment 4,000
Operating - Loss on Disposal of Plant Assets 3,000
Accumulated Depreciation - Equipment 1,000
Equipment 8,000
h. Operating - Increase in Accounts Payable 16,000
Accounts Payable 16,000
i. Income Taxes Payable 2,000
Operating - Decrease in Income Taxes Payable 2,000
j. Financing - Increase in Common Stock 20,000
Common Stock 20,000
k. Operating - Depreciation Expense - Building 6,000
Accumulated Depreciation - Building 6,000
l. Operating - Depreciation Expense - Equipment 3,000
Accumulated Depreciation - Equipment 3,000
m 145,00
. Operating - Net Income 0
145,00
Retained Earnings 0
n. Retained Earnings 29,000
Financing - Payment of Dividends 29,000
o. Cash 22,000
Increase in Cash 22,000