Question
In: Accounting
Steamy Stacks, Inc. sells toy trains. Steamy Stacks began business on October 1 by issuing (selling) 10,000...
Steamy Stacks, Inc. sells toy trains. Steamy Stacks began business on October 1 by issuing (selling) 10,000 shares of no-par common stock. for $10 per share. The issuance of common stock represents investment by owners. Steamy Stacks uses the accrual method of accounting.
During the month of October, the following transactions occurred:
10/1 Issued 10,000 shares of no-par common stock for $10 per share.
10/1 Paid rent of $1,500 for office and retail space for month of October.
10/5 Purchase 500 toy trains for $25 each. The trains were received by Steamy Stacks and payment is due on November 5.
10/10 Sold 150 trains for $45 each. The trains were delivered and cash was received.
HINT: Remember to ‘match’ expenses to revenue they helped to generate…
10/16 Paid $3,000 wages to employees. Employees are paid on the 1st and 16th of each month for the periods ending on the 15th and last day of month, respectively. For simplicity, assume all payments equal $3,000.
10/17 Sold 300 trains for $45 each. The trains were delivered. Payment is due on Nov. 17.
10/20 Ordered Christmas Steamy Stacks advertisement. The advertisements are scheduled to run the last week of November. The advertising agency required 40% payment with the order and the total charge was $1,300. Paid $520.
10/22 Received order for 125 trains to be delivered December 10.
10/31 Paid a cash dividend of $ .10 per share of common stock.
During the month of November, the following transactions occurred:
Start your worksheet with beginning balances of $116,000 (i.e. Ending balance Oct = beg. balance Nov.)
11/1 Paid $3,000 wages to employees.
11/1 Paid rent of $1,500 for office and retail space for month of November.
11/1 Paid $12,000 for one year of insurance premiums.
11/4 Paid for trains received Oct. 5. (500 trains @ $25 each)
11/6 Purchased 300 trains for $25 each. Paid cash.
11/9 Received an order for 100 trains to be delivered on Nov. 19.
11/12 Received an order for 500 trains to be delivered on Dec 10. Since such a large order, Steamy Stacks required a deposit of $11,000.
11/15 Received payment associated with sale on Oct. 17. (sold 300 trains @ $45 each)
11/16 Paid $3,000 wages to employees.
11/19 Delivered the trains ordered on November 9 (100 trains at $45). Payment due Dec. 9.
11/20 Sold 150 trains for $45 each. The trains were delivered. Cash was received.
11/21 Fired an employee for inappropriate behavior. This will reduce the payroll from $3,000 to $2,800 for the period ending 11/30.
11/22 Purchased 1,000 business cards from Kinko’s. Delivery and payment of $100 made.
11/25 Purchased 200 trains for $25 each. Payment is due Dec. 22.
11/29 Borrowed $25,000 from the bank by signing a five-year, 6% a.p.r. note. Interest payments are due quarterly.
11/30 Christmas advertisement ran last week of November. Paid the remaining balance of $780.
REQUIREMENTS:
1. Record transactions on worksheet according to the accrual method of accounting.
2. Prepare a multi-step income statement for the month of November.
3. Prepare a statement of stockholder’s equity as of November 30
4. Prepare a classified balance sheet for Steamy Stacks as of November 30.
Only looking for help with the November transaction list, income statement, Stockholders equity, and balance sheet.
Solutions
Expert Solution
| 1. Journal Entries | |||
| JOURNAL ENTRIES | |||
| Date | Particulars | Debit ($) | Credit ($) |
| 11/1 | Wages A/c DR | 3,000.00 | |
| To, Cash A/c | 3,000.00 | ||
| 11/1 | Office and retail space rent A/c DR | 1,500.00 | |
| To, Cash A/c | 1,500.00 | ||
| 11/1 | Prepaid Insurance premuim A/c DR | 12,000.00 | |
| To, Cash A/c | 12,000.00 | ||
| 11/4 | Account Payable A/c DR | 12,500.00 | |
| To, Cash A/c | 12,500.00 | ||
| 11/6 | Purchase A/c DR | 7,500.00 | |
| To, Cash A/c | 7,500.00 | ||
| 11/9 | No Entry | ||
| 11/12 | Cash A/c DR | 11,000.00 | |
| To, Security Deposit A/c | 11,000.00 | ||
| 11/15 | Cash A/c DR | 13,500.00 | |
| To, Account Receivable A/c | 13,500.00 | ||
| 11/16 | Wages A/c DR | 3,000.00 | |
| To, Cash A/c | 3,000.00 | ||
| 11/19 | Account Receivable A/c DR | 4,500.00 | |
| To, Sales A/c | 4,500.00 | ||
| 11/20 | Cash A/c DR | 6,750.00 | |
| To, Sales A/c | 6,750.00 | ||
| 11/21 | Cash A/c DR | 200.00 | |
| To, Wages A/c | 200.00 | ||
| 11/22 | Stationery A/c DR | 100.00 | |
| To, Cash A/c | 100.00 | ||
| 11/25 | Purchase A/c DR | 5,000.00 | |
| To, Account Payable A/c | 5,000.00 | ||
| 11/29 | Cash A/c DR | 25,000.00 | |
| To, 6% a.p.r Note | 25,000.00 | ||
| 11/30 | Advertisement Payable A/c DR | 780.00 | |
| To, Cash A/c | 780.00 | ||
| 2. Income Statement | ||
| INCOME STATEMENT | ||
| for the month on Novmber, | ||
| Particulars | ($) | ($) |
| Revenue | 11,250.00 | |
| Opening Stock | 1,250.00 | |
| Add: Purchase | 12,500.00 | |
| 13,750.00 | ||
| Less: Closing Stock | 7,500.00 | |
| Cost of Goods Sold | 6,250.00 | |
| Gross Profit | 5,000.00 | |
| Wages | 5,800.00 | |
| Office and retail space rent | 1,500.00 | |
| Stationery | 100.00 | |
| Indirect Expenses | 7,400.00 | |
| Net Profit / (Loss) | (2,400.00) | |
| 3. Statement of stockholder’s equity | ||
| STATEMENT OF STOCKHOLDER's EQUITY | ||
| as of November, 30 | ||
| Particulars | ($) | ($) |
| Beginning balances | 116,000.00 | |
| Add: Net Profit / (Loss) | (2,400.00) | |
| 113,600.00 | ||
| Less: Withdraw | - | |
| Closing Balance | 113,600.00 |
| 4. Balance Sheet | ||
| BALANCE SHEET | ||
| as of November, 30 | ||
| Particulars | ($) | ($) |
| EQUITY AND LIABILITIES | ||
| Stockholder's Equity | 113,600.00 | |
| NON CURRENT LIABILITIES | ||
| 6% a.p.r Note | 25,000.00 | |
| CURRENT LIABILITIES | ||
| Security Deposit from Customer | 11,000.00 | |
| Account Payable | 5,000.00 | 16,000.00 |
| TOTAL LIABILITIES | 154,600.00 | |
| ASSETS | ||
 ekkarill92 answered 1 year agoRelated SolutionsSteamy Stacks, Inc. sells toy trains. Steamy Stacks began business on October 1 by issuing (selling)...Steamy Stacks, Inc. sells toy trains. Steamy Stacks began
business on October 1 by issuing (selling) 10,000 shares of no par
common stock. for $10 per share. The issuance of common stock
represents investment by owners. Steamy Stacks uses the accrual
method of accounting.
During the month of October, the following
transactions occurred:
10/1 Issued 10,000 shares of no par common stock for $10 per
share.
10/1 Paid rent of $1,500 for office and retail space for month
of October....
Transaction Analysis Activity Steamy Stacks, Inc. sells toy trains. Steamy Stacks began business on October 1...Transaction Analysis Activity
Steamy Stacks, Inc. sells toy trains. Steamy Stacks began
business on October 1 by issuing (selling) 10,000 shares of no par
common stock. for $10 per share. The issuance of common stock
represents investment by owners. Steamy Stacks uses the accrual
method of accounting.
During the month of October, the following
transactions occurred:
10/1 Issued 10,000 shares
of no par common stock for $10 per share.
10/1 Paid rent of $1,500 for
office and...
The Lemmon Company began selling cars on January 1, 2016. Lemon purchases cars for $10,000 and...
The Lemmon Company
began selling cars on January 1, 2016. Lemon purchases cars for
$10,000 and sell them
for $14,000. Each car Lemon
sells comes with a 3 year warranty. Lemon estimates it will cost
$1000 per car for
warranty repairs
In 2016 Lemon sold 5000 cars and spent $230,000 on
repairs
In 2017 Lemon sold 7000 cars and spent $6,000,000
on repairs
At the beginning of 2018, due
to improvements in technology, Lemon estimates it will only cost
$800...
M&JB Investment Corp. (with a 12/31 year-end) began operations on 1/1/X1 by issuing 10,000 shares of...M&JB Investment Corp. (with a 12/31 year-end) began
operations on 1/1/X1 by issuing 10,000 shares of $5 par value
common stock to 5 shareholders. Each shareholder paid $40,000 for
their 2,000 shares. M&JB uses straight-line amortization for
bond investments, all of which paid annual interest when due on
12/31.Ignore income taxes. Round each transaction to the nearest
dollar.
The following transactions took place:
20X1:
Jan. 1 Record the initial investment by the owners
described above.
Bought the following Available-for-Sale (AFS)...
Houghton Company began business on January 1, 2015 by issuing all of its 1,600,000 authorized shares...
Houghton Company began business on January 1, 2015 by issuing
all of its 1,600,000 authorized shares of its $2 par value common
stock for $31 per share. On June 30, Houghton declared a cash
dividend of $1.50 per share to stockholders of record on July 31.
Houghton paid the cash dividend on August 30. On November 1,
Houghton reacquired 320,000 of its own shares of stock for $36 per
share. On December 22, Houghton resold 160,000 of these shares for...
Houghton Company began business on January 1, 2015 by issuing all of its 1,600,000 authorized shares...
Houghton Company began business on January 1, 2015 by issuing
all of its 1,600,000 authorized shares of its $2 par value common
stock for $31 per share. On June 30, Houghton declared a cash
dividend of $1.50 per share to stockholders of record on July 31.
Houghton paid the cash dividend on August 30. On November 1,
Houghton reacquired 320,000 of its own shares of stock for $36 per
share. On December 22, Houghton resold 160,000 of these shares for...
Sage Creek Inc. began operations on 1/1/20. The company purchased $10,000 worth of computer equipment on...
Sage Creek Inc. began operations on 1/1/20. The
company purchased $10,000 worth of computer equipment on August 1,
and $50,000 worth of restaurant equipment on November 1. All of the
equipment is 5 year property. Assuming that the company elects out
of bonus depreciation and elects a Section 179 deduction of $10,000
on the restaurant equipment purchased in November.
(a) compute the total depreciation expense including
Section 179 for Gallagher for 2020.
(b) compute the 2022 depreciation expense on the...
JackJoe, Inc. sells toy mice to high end pet stores. It was formed on Jan 1,...
JackJoe, Inc.
sells toy mice to high end pet stores. It was formed on Jan 1, 20x4
with a sale of $1 par value common stock and the issuance of a
Bond.
Following is JackJoe's trial balance after the first year of
operation, through December 1 20x4. This trial balance does not
reflect the transactions that occurred during the last month of the
year or adjustments that are necessary, as described by the
additional information. The Bond payable was sold...
JackJoe, Inc. sells toy mice to high end pet stores. It was formed on Jan 1,...
JackJoe, Inc. sells toy mice to high
end pet stores. It was formed on Jan 1, 20x4 with a sale of $1 par
value common stock and the issuance of a Bond.
Following is JackJoe's trial balance after the first year of
operation, through December 1 20x4. This trial balance does not
reflect the transactions that occurred during the last month of the
year or adjustments that are necessary, as described by the
additional information. The Bond payable was sold...
The following transactions occurred at the Daisy King Ice Cream Company. Started business by issuing 10,000...The following transactions occurred at the Daisy King Ice Cream
Company.
Started business by issuing 10,000 shares of common stock for
$37,000.
Signed a franchise agreement to pay royalties of 5% of
sales.
Leased a building for three years at $670 per month and paid
six months' rent in advance.
Purchased equipment for $7,100, paying $4,000 down and signing
a two-year, 8% note for the balance.
Purchased $3,500 of supplies on account.
Recorded cash sales of $2,500 for the first...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
ADVERTISEMENT
|