In: Accounting
Brothers Harry and Herman Hausyerday began operations of their machine shop (H & H Tool, Inc.) on January 1, 2016. The annual reporting period ends December 31. The trial balance on January 1, 2018, follows (the amounts are rounded to thousands of dollars to simplify):
Account Titles | Debit | Credit | ||||
Cash | $ | 3 | ||||
Accounts Receivable | 5 | |||||
Supplies | 12 | |||||
Land | 0 | |||||
Equipment | 69 | |||||
Accumulated Depreciation | $ | 6 | ||||
Software | 24 | |||||
Accumulated Amortization | 4 | |||||
Accounts Payable | 5 | |||||
Notes Payable (short-term) | 0 | |||||
Salaries and Wages Payable | 0 | |||||
Interest Payable | 0 | |||||
Income Tax Payable | 0 | |||||
Common Stock | 90 | |||||
Retained Earnings | 8 | |||||
Service Revenue | 0 | |||||
Salaries and Wages Expense | 0 | |||||
Depreciation Expense | 0 | |||||
Amortization Expense | 0 | |||||
Income Tax Expense | 0 | |||||
Interest Expense | 0 | |||||
Supplies Expense | 0 | |||||
Totals | $ | 113 | $ | 113 | ||
Transactions and events during 2018 (summarized in thousands of dollars) follow:
Data for adjusting journal entries as of December 31:
Adjusting entries | |||||||
S.no. | Accounts title and explanations | Debit $ | Credit $ | ||||
k | Amortization expense | 4 | |||||
Accumulated Amortization | 4 | ||||||
(for amortization expense recognized) | |||||||
l | Supplies expense | 20 | |||||
Supplies account (12+18+10) | 20 | ||||||
(for supplies used) | |||||||
m. | Depreciation expense | 6 | |||||
Accumulated Depreciation | 6 | ||||||
(for depreciation charged) | |||||||
n. | Interest expense | 1 | |||||
Interest payable | 1 | ||||||
(for interest expense) | |||||||
o | Salaries and wages expense | 12 | |||||
Salaries and wages payable | 12 | ||||||
(for salaries accrued) | |||||||
p. | Income tax expense | 8 | |||||
Income tax payable | 8 | ||||||
(for income tax dues) |