Question

Marmidan Mold Shop Inc. designs and builds molds for the automotive and aircraft industries. The account balances in the company’s general ledger on January 1, 2020 (first day of the new annual fiscal year) were as follows (all account balances are in their normal position):

Cash                                                                    $     3,700

Accounts receivable                                                   5,900

Supplies inventory                                                    29,300

Land                                                                        168,500  

Buildings                                                                 116,500

Accumulated depreciation, buildings                       37,500   

Equipment                                                                 58,500

Accumulated depreciation, equipment                     18,000

Accounts payable                                                      25,200

Income tax payable                                                   16,600

Interest payable                                                           4,200

Wages payable (due in 2020)                                    15,700                                         

9% Notes payable ($10,000 due June 30, 2021,

     balance due June 30, 2022)                                  61,500

Common shares                                                       151,500

Retained earnings, Dec. 31, 2019                              52,200         

Transactions during 2020:

1.The company provided sales services to customers, on credit, for $ 210,300. In addition, the company produced cash sales to customers of $ 62,300.

2.Accounts receivable from customers of $ 15,600 remains to be collected at December 31, 2020.

3.Inventory of $ 62,900 was purchased on credit and debited to the supplies inventory account.

4.Minor parts were purchased with cash for $ 7,400 and debited to the supplies inventory account.

5.Wages payable at the beginning of 2020 were paid early in 2020. In addition, wages were earned by employees and paid during 2020 in the amount of $ 112,000.

6.Income tax payable at the beginning of 2020 was paid early in 2020.

7.Payments of $ 73,000 were made to creditors for supplies previously purchased on credit.

8.One year’s interest at 9% was paid on the notes payable at July 1, 2020.

9. During 2020, Don Tallint, the principal shareholder, purchased a new car for his wife

    Debbie. The new car cost $ 45,000 and was paid for with cash from personal sources.

10.Property taxes were paid on the land and buildings in the amount of $ 17,000 with cash.

11.Dividends were declared and paid in caah in the amount of $ 7,200.

Information available for year end adjusting entries:

12.•Supplies inventory was counted on December 31, 2020 and it was determined the supplies inventory still on hand at yearend was $ 31,900.

13. •Annual depreciation on the buildings is $ 6,000.

14•Annual deprecation on the equipment is $ 5,500

15•Additional wages of $4,000 were earned but are unpaid and unrecorded at December 31, 2020.

16•Interest for six months at 9% per year on the notes payable is unpaid and unrecorded at December 31, 2020.

17•Income taxes of $ 16,500 were unpaid and unrecorded at December 31, 2020.

Required:

Prepare any necessary adjusting journal entries for items 11 to 17 above and record the adjusting journal entries in the T accounts while adding any new T accounts that you need as you complete this task.( Record your journal entries on the electronic worksheet )

Answer 1

Journal Entries in the Books of Marmidan Mold Shop Inc.
Date	Particulars		Debit ($)	Credit ($)
2020	Accouts Receivables A/C	Dr	$62,300
	To Sales A/C			$62,300
	Being Cash Sales made
2020	Cash A/C	Dr	$210,300
	To Sales A/C			$210,300
	Being Credit Sales made
2020	Purchases A/c	Dr	$62,900
	To Accounts Payables A/C			$62,900
	Being Purchases made on credit
2020	Bank A/C	Dr	$200,600
	To Accounts Receivables A/C			$200,600
	Being amount received from customers
2020	Miscellineous expenses A/C	Dr	$7,400
	To cash A/C			$7,400
	Being Minor parts purchased
2020	Wages Payable A/C	Dr	$15,700
	To cash A/C			$15,700
	Being Wages payables paid
2020	Wages A/C	Dr	$112,000
	To cash A/C			$112,000
	Being Wages recognised
2020	Income tax payable A/C	Dr	$112,000
	To cash A/C			$112,000
	Being Income tax payable paid
2020	Accounts payable A/C	Dr	$73,000
	To cash A/C			$73,000
	Being amount paid to suppliers
2020	9% Notes Payables	Dr	$10,000
	To cash A/C			$10,000
	Being amount due on notes payables paid
2020	Interest Expense A/C	Dr	$5,535
	To cash A/C			$5,535
	Being Interest Expense on 9% notes payables paid ($61500*9%)
2020	Property tax A/c	Dr	$17,000
	To cash A/C			$17,000
	Being Property tax paid
2020	Dividends A/C	Dr	$7,200
	To cash A/C			$7,200
	Being Dividends paid
2020	Depreciation on Building A/c	Dr	$6,000
	To Accumulated Depreciation on Building A/C			$6,000
	Being Depreciation expense recognised
2020	Depreciation on Equipment A/c	Dr	$5,500
	To Accumulated Depreciation on Equipment A/C			$5,500
	Being Depreciation expense recognised
2020	Wages A/C	Dr	$5,000
	To Wages Payables A/C			$5,000
	Being wages payables recognised
2020	Interest Expense A/C	Dr	$4,635
	To Interest Payable A/C			$4,635
	Being Interest Expense on 9% notes payables paid ($61500*9%)
2020	Income tax A/C	Dr	$16,500
	To Income Tax Payable A/C			$16,500
	Being Income tax expense recognised
2020	Profit and Loss A/C	Dr	$16,500
	To Cost of Goods Sold A/C			$16,500
	Being Cost of Goods Sold recognised (29300+6900+7400-31900)

Cash A/C
Date	Particulars	Debit ($)	Date	Particulars	Credit ($)
2020	Opening Balance	ekkarill92 Next > < Previous Related Solutions Marmidan Mold Shop Inc. designs and builds molds for the automotive and aircraft industries. The account... Marmidan Mold Shop Inc. designs and builds molds for the automotive and aircraft industries. The account balances in the company’s general ledger on January 1, 2020 (first day of the new annual fiscal year) were as follows (all account balances are in their normal position): Cash                                                                    $     3,700 Accounts receivable                                                   5,900 Supplies inventory                                                    29,300 Land                                                                        168,500   Buildings                                                                 116,500 Accumulated depreciation, buildings                       37,500    Equipment                                                                 58,500 Accumulated depreciation, equipment                     18,000 Accounts payable                                                      25,200 Income tax payable                                                   16,600 Interest payable                                                           4,200 Wages payable... Marmidan Mold Shop Inc. designs and builds molds for the automotive and aircraft industries. The account... Marmidan Mold Shop Inc. designs and builds molds for the automotive and aircraft industries. The account balances in the company’s general ledger on January 1, 2020 (first day of the new annual fiscal year) were as follows (all account balances are in their normal position): Cash                                                                    $     3,700 Accounts receivable                                                   5,900 Supplies inventory                                                    29,300 Land                                                                        168,500   Buildings                                                                 116,500 Accumulated depreciation, buildings                       37,500    Equipment                                                                 58,500 Accumulated depreciation, equipment                     18,000 Accounts payable                                                      25,200 Income tax payable                                                   16,600 Interest payable                                                           4,200 Wages payable... Marmidan Mold Shop Inc. designs and builds molds for the automotive and aircraft industries. The account... Marmidan Mold Shop Inc. designs and builds molds for the automotive and aircraft industries. The account balances in the company’s general ledger on January 1, 2020 (first day of the new annual fiscal year) were as follows (all account balances are in their normal position): Cash                                                                    $     3,700 Accounts receivable                                                   5,900 Supplies inventory                                                    29,300 Land                                                                        168,500   Buildings                                                                 116,500 Accumulated depreciation, buildings                       37,500    Equipment                                                                 58,500 Accumulated depreciation, equipment                     18,000 Accounts payable                                                      25,200 Income tax payable                                                   16,600 Interest payable                                                           4,200 Wages payable... Marmidan Mold Shop Inc. designs and builds molds for the automotive and aircraft industries. The account... Marmidan Mold Shop Inc. designs and builds molds for the automotive and aircraft industries. The account balances in the company’s general ledger on January 1, 2020 (first day of the new annual fiscal year) were as follows (all account balances are in their normal position): Cash                                                                    $     3,700 Accounts receivable                                                   5,900 Supplies inventory                                                    29,300 Land                                                                        168,500   Buildings                                                                 116,500 Accumulated depreciation, buildings                       37,500    Equipment                                                                 58,500 Accumulated depreciation, equipment                     18,000 Accounts payable                                                      25,200 Income tax payable                                                   16,600 Interest payable                                                           4,200 Wages payable... Marmidan Mold Shop Inc. designs and builds molds for the automotive and aircraft industries. The account... Marmidan Mold Shop Inc. designs and builds molds for the automotive and aircraft industries. The account balances in the company’s general ledger on January 1, 2020 (first day of the new annual fiscal year) were as follows (all account balances are in their normal position): Cash                                                                    $     3,700 Accounts receivable                                                   5,900 Supplies inventory                                                    29,300 Land                                                                        168,500   Buildings                                                                 116,500 Accumulated depreciation, buildings                       37,500    Equipment                                                                 58,500 Accumulated depreciation, equipment                     18,000 Accounts payable                                                      25,200 Income tax payable                                                   16,600 Interest payable                                                           4,200 Wages payable... Marmidan Mold Shop Inc. designs and builds molds for the automotive and aircraft industries. The account... Marmidan Mold Shop Inc. designs and builds molds for the automotive and aircraft industries. The account balances in the company’s general ledger on January 1, 2020 (first day of the new annual fiscal year) were as follows (all account balances are in their normal position): Cash                                                                    $     3,700 Accounts receivable                                                   5,900 Supplies inventory                                                    29,300 Land                                                                        168,500   Buildings                                                                 116,500 Accumulated depreciation, buildings                       37,500    Equipment                                                                 58,500 Accumulated depreciation, equipment                     18,000 Accounts payable                                                      25,200 Income tax payable                                                   16,600 Interest payable                                                           4,200 Wages payable... Marmidan Mold Shop Inc. designs and builds molds for the automotive and aircraft industries. The account... Marmidan Mold Shop Inc. designs and builds molds for the automotive and aircraft industries. The account balances in the company’s general ledger on January 1, 2020 (first day of the new annual fiscal year) were as follows (all account balances are in their normal position): Cash                                                                    $     3,700 Accounts receivable                                                   5,900 Supplies inventory                                                    29,300 Land                                                                        168,500   Buildings                                                                 116,500 Accumulated depreciation, buildings                       37,500    Equipment                                                                 58,500 Accumulated depreciation, equipment                     18,000 Accounts payable                                                      25,200 Income tax payable                                                   16,600 Interest payable                                                           4,200 Wages payable... Marmidan Mold Shop Inc. designs and builds molds for the automotive and aircraft industries. The account... Marmidan Mold Shop Inc. designs and builds molds for the automotive and aircraft industries. The account balances in the company’s general ledger on January 1, 2020 (first day of the new annual fiscal year) were as follows (all account balances are in their normal position): Cash                                                                    $     3,700 Accounts receivable                                                   5,900 Supplies inventory                                                    29,300 Land                                                                        168,500   Buildings                                                                 116,500 Accumulated depreciation, buildings                       37,500    Equipment                                                                 58,500 Accumulated depreciation, equipment                     18,000 Accounts payable                                                      25,200 Income tax payable                                                   16,600 Interest payable                                                           4,200 Wages payable... Marmidan Mold Shop Inc. designs and builds molds for the automotive and aircraft industries. The account... Marmidan Mold Shop Inc. designs and builds molds for the automotive and aircraft industries. The account balances in the company’s general ledger on January 1, 2020 (first day of the new annual fiscal year) were as follows (all account balances are in their normal position): Cash                                                                    $     3,700 Accounts receivable                                                   5,900 Supplies inventory                                                    29,300 Land                                                                        168,500   Buildings                                                                 116,500 Accumulated depreciation, buildings                       37,500    Equipment                                                                 58,500 Accumulated depreciation, equipment                     18,000 Accounts payable                                                      25,200 Income tax payable                                                   16,600 Interest payable                                                           4,200 Wages payable... Marmidan Mold Shop Inc. designs and builds molds for the automotive and aircraft industries. The account... Marmidan Mold Shop Inc. designs and builds molds for the automotive and aircraft industries. The account balances in the company’s general ledger on January 1, 2020 (first day of the new annual fiscal year) were as follows (all account balances are in their normal position): Cash                                                                    $     3,700 Accounts receivable                                                   5,900 Supplies inventory                                                    29,300 Land                                                                        168,500   Buildings                                                                 116,500 Accumulated depreciation, buildings                       37,500    Equipment                                                                 58,500 Accumulated depreciation, equipment                     18,000 Accounts payable                                                      25,200 Income tax payable                                                   16,600 Interest payable                                                           4,200 Wages payable... 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