Question

In: Accounting

1 The company issued common stock for $21,000 2a Supplies are purchased for $3,000. 2b Insurance...

1 The company issued common stock for $21,000

2a Supplies are purchased for $3,000.

2b Insurance is paid for 6 months beginning January 1: $5,400 (record as an asset)

2c Rent is paid for 3 months beginning in January: $4,500 (record as an asset)

3 Blackberry Mountain Inc borrows $45,000 from 1st State Bank at 12% annual interest.

6 An equipment is purchased for $22,500 cash. It will be used for 3 years and will be depreciated monthly using straight-line depreciation with no salvage value. A full month of depreciation will be charged in January.

9 Services are performed for customers on account. Invoices totaling $9,800 are mailed.

10 Services are performed for cash customers: $7,600.

15 Blackberry Mountain Inc borrows $16,000 from 2nd State Bank at 9% annual interest.

16 Wages for the first half of the month are paid on January 16: $4,200

20 The company receives $3,000 from a customer for an advance order for services to be provided in January and February.

25 Collections from customers on account (see January 9 transaction): $4,500.

30 A $3,100 utility bill for January arrived. It is due on February 15.

Additional information for the adjusting entries at January 31:

a. The company completed 60% of the deliveries for the customer that paid in advance on January 20th.

b. Interest is accrued for the two bank loans (assume a full month for the 1st State Bank loan and ½ month for the 2nd State Bank loan).

c. The last 2 weeks wages earned by employees are $4,200 and will be paid on February 3rd.

d. Record January depreciation.

e. Adjust the prepaid asset accounts as needed.

Instructions

1. Prepare journal entries for each event.

2. Prepare the t-accounts

3. Prepare unadjusted Trial Balance.

4. Record Adjusting Entries.

5. Prepare Adjusting Trial Balance.

6. Prepare Income Statement, Balance sheet, and Statement of Retained Earnings.

7. Prepare closing Entries.

Can you please answer all questions in detail that how you did calculations?

The more important part is financial statements and closing entries. I need all details.

Solutions

Expert Solution

Journal entries posted to T accounts

Adjusting entries posted to T accounts

For financial statements, all figures are taken from Trial Balance

For Balance Sheet, all figures taken from Trial Balance except for Retained Earnings taken from above statement

For Closing entries, all figures taken from Trial Balance

ekkarill92 answered 1 year ago

Next > < Previous

Related Solutions

1) A company has 3,000 shares of common stock outstanding at a price of $27 per...

1) A company has 3,000 shares of common stock outstanding at a price of $27 per share. It also has 150 bonds outstanding, each with a face value of $1,000 and currently selling at 45% of face value. The tax rate is 20%. What is the weight of debt that would be used in the calculation of the weighted average cost of capital? 2) A company has equity with a market value of $15,000 and debt with a market value...

On January 1, Year 1, Prairie Enterprises issued common stock for $30,000 cash and purchased computer...

On January 1, Year 1, Prairie Enterprises issued common stock for $30,000 cash and purchased computer equipment for $28,000 cash. The equipment had a useful life of 5 years and a salvage value of $2,000. Prairie uses the straight line depreciation method. How much Depreciation Expense does Prairie recognize each year? What is the ending balance of Accumulated Depreciation at the end of Year 3? What is the book value of the equipment at the beginning of Year 4? What...

March 1 Issued 10,000 shares of common stock for $25,000 cash. 1 Purchased used servers for...

March 1 Issued 10,000 shares of common stock for $25,000 cash. 1 Purchased used servers for $10,000, paying $6,000 cash and the balance on account. 3 Purchased office supplies for $1,500 on account. 5 Paid $2,400 cash on 1-year insurance policy effective March 1. 14 Billed customers $4,200 for data analysis services. 18 Paid $1,500 cash on amount owed on servers and $500 on amount owed on office supplies. 20 Paid $2,750 cash for employee salaries. 21 Collected $1,400 cash...

The gas-phase, elementary reaction: 2A + 1/2B ----> C + 2D will be conducted in a...

The gas-phase, elementary reaction: 2A + 1/2B ----> C + 2D will be conducted in a constant volume, isothermal batch reactor. The reactor is initially charged with a stoichiometric ratio of A and B. The reaction is moderately exothermic and the heat of reaction will be removed via cooling water. The following data is available: Initial Conditions: Initial concentration of A = Cao, initial concentration of B = Cbo Cooling water: inlet temperature = Ta1, outlet temperature = Ta2, water...

On January 1, 2011, Parent Company Purchased 80% of the common stock of Subsidiary Company for...

On January 1, 2011, Parent Company Purchased 80% of the common stock of Subsidiary Company for $402,000. On this date, Subsidiary had total owners' equity of $440,000. Land was undervalued by $20,000, Equipment with a 5-year remaining life was undervalued by $15,000 and inventory was undervalued by $10,000. Any other excess of cost over book value is due to goodwill. Parent accounts for its investment in Subsidiary using the simple equity method. 1) Prepare the Determination and Distribution of Excess...

On January 1, 20X8, Parent Company purchased 75% of the common stock of Subsidiary Company for...

On January 1, 20X8, Parent Company purchased 75% of the common stock of Subsidiary Company for $360,000. On this date, Subsidiary had common stock, other paid in capital, and retained earnings of $20,000, $130,000, and $200,000, respectively. Any excess of cost over book value is due to goodwill. Parent accounts for the Investment in Subsidiary using cost method. On January 1, 20X8, Subsidiary sold $100,000 par value of 6%, ten-year bonds for $97,000. The bonds pay interest semi-annually on January...

On January 1, 2020, Parent Company purchased 80% of the common stock of Subsidiary Company for...

On January 1, 2020, Parent Company purchased 80% of the common stock of Subsidiary Company for $320,000. On this date, Subsidiary had common stock, other paid-in capital, and retained earnings of $40,000, $120,000, and $190,000, respectively. Net income and dividends for Subsidiary Company were $50,000 and $10,000, respectively. Parent Company has used the simple equity method for recording the Subsidiary income and dividends. On January 1, 2020, the only tangible assets of Subsidiary that were undervalued were inventory and equipment....

On May 1, 2020, Peters Company purchased 80% of the common stock of Smith Company for...

On May 1, 2020, Peters Company purchased 80% of the common stock of Smith Company for $50,000. Additional data concerning these two companies for the years 2020 and 2021 are: 2020 2021 Peters Smith Peters Smith Common stock $100,000 $25,000 $100,000 $25,000 Other contributed capital 40,000 10,000 40,000 10,000 Retained earnings, 1/1 80,000 10,000 129,000 53,000 Net income (loss) 64,000 45,000 37,500 (5,000) Cash dividends (11/30) 15,000 2,000 5,000 —0— Any difference between book value and the value implied by...

On January 1, 2014, Paterson Company purchased 70% of the common stock of Smith Company for...

On January 1, 2014, Paterson Company purchased 70% of the common stock of Smith Company for $420,000. At that time, Smith’s stockholders’ equity consisted of $80,000 of Common stock, $60,000 of Other contributed capital, and $240,000 of Retained earnings. Any difference between implied and book value relates to Smith’s land. Paterson uses the cost method to record its investment in Smith. Its fiscal year ends on December 31. Additional information for both companies for 2020 follows: Paterson Smith Common stock...

Cash 36,000 2,000 Accounts receivable 21,000 39,000 Inventory 5,700 49,000 Supplies 2,500 3,000 65,200 93,000 Land...

Cash 36,000 2,000 Accounts receivable 21,000 39,000 Inventory 5,700 49,000 Supplies 2,500 3,000 65,200 93,000 Land 1,100,000 800,000 Building 1,150,000 900,000 Accumulated depreciation – building (276,000) (180,000) Vehicles 15,000 28,000 Accumulated depreciation – vehicles (3,600) (5,600) 1,985,400 1,542,400 $2,050,600 $1,635,400 Accounts payable 38,000 49,000 Dividends payable 25,000 1,300 Current bank loan 55,000 55,000 118,000 105,300 Non-current bank loan 1,700,600 1,320,100 1,818,600 1,425,400 Common shares 120,000 100,000 Retained earnings 112,000 110,000 232,000 210,000 $2,050,600 $1,635,400 During 2018 the following occurred: Land...

Subjects