Accounting for Stock

A business purchased stock for $5000 (Rec 80) What impact does this transaction have on the firms assets?

Note - Assume no GST for this transaction

• Up $5000

• Down $5000

• Stays the same

• Down $2000

A business purchased stock for $5000 (Inv 50) What impact does this transaction have on the firms assets?

Note - Ignore GST

• Up $5,000

• Down $5,000

• No impact

• Down $2,000

A business purchased stock for $7000+GST (Inv 50) What impact does this transaction have on the firms liabilites?

Note - Assume GST is a liability

• Up $7700

• Up $7000

• Up $6300

• No impact

A business purchased stock for $7000+GST (Inv 50) What impact does this transaction have on the firms liabilities?

Note - Assume GST is initially an asset of $1000

• Down $7,700

• Down $7,000

• Up $7,700

• Down $7,700

A business purchased stock on credit for $7000+GST (Inv 50) What impact does this transaction have on the firms assets?

Note - Assume GST is initially an asset of $1000

• Up $7,700

• Up $7,000

• Up $6,300

• Down $6,300

A business purchased stock for cash for $7000+GST (Rec 50) What impact does this transaction have on the firms assets?

Note - Assume GST is initially an asset of $1000

• Up $7,700

• Up $7,0000

• Up $7,000

• No impact

• Down $7,000

A business sold stock valued at $1,000 at a mark up of 100% + GST. What is the impact on the firms profit

Note - Assume GST is a liability

• Increase $1,200

• Increase $2,000

• Increase $1,000

• Increase $500

A business sold stock valued at $1,000 at a mark up of 300% + GST (Rec 50). What is the impact on the firms assets?

Note - Assume GST is a liability

• Up $4,000

• Up $3,000

• Up $4,400

• Up $3,400

A business sold stock valued at $1,000 at a mark up of 300% + GST (Rec 50). What is the impact on the firms liabilities?

Note - Assume GST is a liability

• Up $4,400

• Up $400

• Down $400

• Down $4,400

A business sold stock valued at $1,000 at a mark up of 300% + GST (Inv. 50). What is the impact on the firms liabilities?

Note - Assume GST is an asset of $2,000 to begin with

• Up $400

• Up $1000

• No impact

• Up $4,400