Higher the debt ratio, more the financial leverage a firm has and thus, the greater will be its risk and return. True False

Higher the debt ratio, more the financial leverage a firm has and thus, the greater will be its risk and return. True False

On January 1, 2018, the general ledger of Dynamite Fireworks includes the following account balances

On January 1, 2018, the general ledger of Dynamite Fireworks includes the following account balances:

 

  Accounts           Debit     Credit

  Cash    $              23,800                                                    

  Accounts Receivable                    5,200                                                      

  Supplies                             3,100                                                      

  Land                    50,000                                                    

  Accounts Payable                                                                          3,200      

  Common Stock                                                                               65,000    

  Retained Earning                                                                            13,900    

       Totals             $              82,100                   $              82,100    

uring January 2018, the following transactions occur:

January 2. Purchase rental space for one year in advance, $6,000 ($500/month).

January 9. Purchase additional supplies on account, $3,500.

January 13. Provide services to customers on account, $25,500.

January 17. Receive cash in advance from customers for services to be provided in the future, $3,700.

January 20. Pay cash for salaries, $11,500.

January 22. Receive cash on accounts receivable, $24,100.

January 29. Pay cash on accounts payable, $4,000.

Record each of the transactions listed above.

Contact Us To Get Tutoring