Identifying Events as Accounting Transactions Do the following events result in a recordable transaction for The Toro Company?
1. Toro purchased robotic manufacturing equipment that it paid for by signing a note payable.
2. Toro’s president purchased stock in another company for his own portfolio.
3. The company lent $550 to an employee.
4. Toro ordered supplies from Office Depot to be delivered next week.
5. Six investors in Toro sold their stock to another investor.
6. The company borrowed $2,500,000 from a local bank.

Question

contestada

Respuesta :

andromache andromache · Answer 1 · 2020-10-02T08:19:09+02:00

Answer and Explanation:

1. The first transaction should be yes as it contains the measurable impact also it impacts the asset and liability

2. The second transaction should be no as the business entity concept is not followed also it is carried out an individual account

3. The third transaction should be yes as it contains the measurable impact also it comes under the transaction i.e. internal exchange

4. The fourth transaction should be no as the amount is not paid.

5. The fifth transaction should be no as the impact the common stock even though is a measurable transaction

6. The sixth transaction should be yes as it contains the measurable impact also it impacts the asset and liability i.e. cash and the note payable