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  • Bryant Company Sells A Wide Range of Inventories Which Are

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    Taimur Technologist
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    Bryant Company purchases inventory on credit, increasing assets and liabilities. They also take out short-term notes payable to obtain cash, increasing assets but also increasing liabilities. The document provides two specific transactions: purchasing $18,000 of inventory on credit in January, and borrowing $40,000 from the bank with a 6-month, 8% interest note in March.

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    Bryant Company Sells a Wide Range of Inventories Which Are

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    Bryant Company purchases inventory on credit, increasing assets and liabilities. They also take out short-term notes payable to obtain cash, increasing assets but also increasing liabilities. The document provides two specific transactions: purchasing $18,000 of inventory on credit in January, and borrowing $40,000 from the bank with a 6-month, 8% interest note in March.

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    © All Rights Reserved
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    10 views1 page

    Bryant Company Sells A Wide Range of Inventories Which Are

    Uploaded by

    Taimur Technologist
    Bryant Company purchases inventory on credit, increasing assets and liabilities. They also take out short-term notes payable to obtain cash, increasing assets but also increasing liabilities. The document provides two specific transactions: purchasing $18,000 of inventory on credit in January, and borrowing $40,000 from the bank with a 6-month, 8% interest note in March.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    Bryant Company sells a wide range of inventories which

    are #2809
    Bryant Company sells a wide range of inventories, which are initially purchased on account.
    Occasionally, a short-term note payable is used to obtain cash for current use. The following
    transactions were selected from those occurring during 2013:a. On January 10, 2013,
    purchased merchandise on credit for $18,000. The company uses a perpetual inventory
    system.b. On March 1, 2013, borrowed $40,000 cash from City Bank and signed a promissory
    note with a face amount of $40,000, due at the end of six months, accruing interest at an annual
    rate of 8 percent, payable at maturity.1. For each of the transactions, indicate the accounts,
    amounts, and effects (+ for increase,- for decrease, and NE for no effect) on the accounting
    equation. Use the following structure:Date Assets = Liabilities + Stockholders' Equity2. What
    amount of cash is paid on the maturity date of the note?3. Discuss the impact of each
    transaction on the quick ratio. (Assume Bryant Company's quick ratio was 1.10 prior to each
    transaction.)View Solution:
    Bryant Company sells a wide range of inventories which are

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