Given below is the balance sheet for a company.
Balance Sheet (Millions of Dollars)
|
Assets
|
|
|
Current Assets
|
|
|
Cash
|
$5,846
|
|
Short-term investments
|
518
|
|
Receivables and other assets
|
4,510
|
|
Inventories
|
607
|
|
Other
|
2,624
|
|
$14,105
|
|
Noncurrent Assets
|
|
|
Property, plant, and equipment
|
$1,594
|
|
Long-term investments
|
318
|
|
Other non-current assets
|
2,533
|
|
Total assets
|
$18,550
|
|
|
|
Liabilities and Stockholders' Equity
|
|
|
Current Liabilities
|
|
|
Accounts payable
|
$5,816
|
|
Other short-term obligations
|
4,585
|
|
$10,401
|
|
Long-term Liabilities
|
$5,159
|
|
Stockholders' equity
|
|
|
Contributed Capital
|
$7,832
|
|
Retained Earnings
|
14,690
|
|
Other stockholders' equity items
|
-19,532
|
|
Total stockholders' equity and liabilities
|
$18,550
|
Assume the following transactions (in millions) during the remainder of the initial year.
(a) Borrowed $20 from banks due in two years
(b) Lent $170 to affiliates, who signed a six-month note
(c) Purchased additional investments for $6,000 cash; one-third were long term and the rest were short-term
(d) Purchased $1820 worth of property, plant, and equipment; paid $600 in cash and the remainder with additional long-term bank loans
(e) Issued additional shares of stock for $400 in cash
(f) Sold short-term investments costing $3,000 for $3,000 cash
(g) Declared and paid $13 in dividends during Year 1
Prepare a journal entry for each transaction. Then create T-accounts for each balance sheet account and include the new transactions. Post each journey entry to the appropriate T-accounts. Finally, create an updated balance sheet.