Journal Entries and Trial Balance

On June 1, 2019, Kris Storey established an interior decorating business, Eco-Centric Designs. During the month, Kris completed the following transactions related to the business.

Enter the following transactions on Page 2 of the two-column journal.

Required:

1. Journalize each transaction in a two-column journal, beginning on Page 1, referring to the following chart of accounts in selecting the accounts to be debited and credited. (Do not insert the account numbers in the journal at this time.) Journal entry explanations may be omitted. For a compound transaction, if an amount box does not require an entry, leave it blank.

Problem 5-01A Sunland Hardware Store completed the following merchandising transactions in the month of May. At the beginning of May, Sunlands’ ledger showed Cash of $8,900 and Common Stock of $8,900. May 1 Purchased merchandise on account from Black Wholesale Supply for $8,900, terms 1/10, n/30. 2 Sold merchandise on account for $5,300, terms 2/10, n/30. The cost of the merchandise sold was $4,200. 5 Received credit from Black Wholesale Supply for merchandise returned $200. 9 Received collections in full, less discounts, from customers billed on May 2. 10 Paid Black Wholesale Supply in full, less discount. 11 Purchased supplies for cash $900. 12 Purchased merchandise for cash $3,900. 15 Received $230 refund for return of poor-quality merchandise from supplier on cash purchase. 17 Purchased merchandise from Wilhelm Distributors for $3,300, terms 2/10, n/30. 19 Paid freight on May 17 purchase $250. 24 Sold merchandise for cash $5,500. The cost of the merchandise sold was $4,100. 25 Purchased merchandise from Clasps Inc. for $800, terms 3/10, n/30. 27 Paid Wilhelm Distributors in full, less discount. 29 Made refunds to cash customers for returned merchandise $108. The returned merchandise had cost $94. 31 Sold merchandise on account for $1,280, terms n/30. The cost of the merchandise sold was $838.

Journalize the transactions using a perpetual inventory system. Post the transactions to T-accounts. Be sure to enter the beginning cash and common stock balances

Prepare an income statement through gross profit for the month of May 2022.

Calculate the profit margin and the gross profit rate. (Assume operating expenses were $1,428.) (Round answers to 1 decimal place, e.g. 15.5%.)

Find equations of both the tangent lines to the ellipse x2 + 9y2 = 81 that pass through the point (27, 3)

Find a primitive root for: (a) n = 18, (b) n = 50 (c) n = 27, (d) n = 625.

what are customers really willing to pay for ? where can the largest margins be achieved ? can customers easily find and purchase cheaper products and services ?

1. The following sample observations were randomly selected (numbers may be different from previous problems):

What is the predicted value of Y when X=7?

Select one:

a. 7.47

b. 26.73

c. -22.53

d. 6.31

2. A business is evaluating their advertising budget, and wishes to determine the relationship between advertising dollars spent and changes in revenue. They have compiled the information in the table below, and want to perform regression.

What is the independent data?

Select one:

a. Weekly Revenue

b. TV Advertising

c. Radio Advertising

d. Newspaper Advertising

e. All Advertising

3. The following sample observations were randomly selected (numbers may be different from previous problems):

What is the y-intercept of the regression equation?

Select one:

a. 3.38

b. 7.00

c. 5.80

d. 5.30

3. (LESSOR ENTRIES FOR FINANCING LEASE WITH A GUARANTEED RESIDUAL)

The following facts pertain to a non-cancelable lease agreement between Ace Leasing Company and King Company, a lessee.

Commencement of Lease Date January 1, 2020

Annual lease payment due at the beginning of the year beginning with January 1, 2020 $137,171

Residual value of equipment at end of lease term, guaranteed by lessee $54,000

Book Value of Lease Equipment on LESSOR books $500,000

Lease term 6 years

Economic life of leased equipment 7 years

Fair Value of asset at January 1, 2020 $659,000

Lessor’s Implicit Rate 12% Lessee’s incremental borrowing rate 12%

The asset will revert to the lessor at the end of the lease term. You examined this lease from the Lessee prospective in problem #1. Based on the tests you found it was a financing lease. In this problem you will complete the LESSOR entries. You do not need to redo the tests – it is still a financing lease with a guaranteed residual

A. Prepare the entry on the Lessor’s book to record this Lease on 1/1/2020. You will need to compute the Lease Receivable debit, the CGS debit, the Equipment credit and the Sale Revenue credit to complete the entry.

B. Complete the entry to receive the first rental payment on 1/1/2020.

C. Prepare the interest revenue amortization schedule for the first two years and prepare the interest revenue entry for 12/31/2020.

Krishna only spends his money on clothes, c, and food, f. His utility function is quasilinear: U(f, c) = 10ln(f) + c. His income is $2000 per month. The price of clothes is $10 while the price of food is $5.

1. Derive his demand function for clothes and food. Given the prices and income, state quantity demanded of clothes and food.

2. Due to a new free trade agreement, the price of clothes falls to $5. What is the new quantity demanded of clothes and food? Are they substitutes or complements?

3. The price of both goods remain at $5 onwards. The economy is not doing well, and Krishna got a cut of 20% on his income. What is the quantity demanded of clothes and food after the paycheck cut? Do they change or remain the same? Why?

4. Draw Engel curve for food and clothes.

5. The government needs to raise tax revenues. It is debating between 3 options: 1) income tax of 20 %, 2) revenue-equivalent of quantity tax of tf on food, or 3) revenue-equivalent of quantity tax of tc on clothes. Find tf and tc that would raise the same amount of revenue with the income tax from Krishna?

6. Under which tax scheme would Krishna be the most well-off? Explain why in 2-3 sentences.

Sutton Pond, Inc.'s, unadjusted and adjusted trial balances at June 30, 2016, follow. Requirements 1. Make the adjusting entries that account for the differences between the two trial balances. 2. Compute Sutton Pond Rentals' total assets, total liabilities, net income, and total equity. Sutton Pond, Inc.'s Trial Balance Sheet June 30, 2016 Trial Balance Adjusted Trial Balance Account Debit Credit Debit Credit Cash $ 8,300 $ 8,300 Accounts receivable 6,800 6,840 Interest receivable 700 Note receivable 4,800 4,800 Supplies 1,800 500 Prepaid Insurance 2,900 2,000 Building 68,000 68,000 Accumulated Depreciation (Building) $ 7,800 $ 9,300 Accounts payable 6,900 6,900 Wages payable 870 Unearned Rental Revenue 1,500 1,000 Common Stock 15,000 15,000 Retained Earnings 41,000 41,000 Dividends 4,000 4,000 Rental Revenue 25,100 25,640 Interest Revenue 1,000 1,700 Depreciation (Building) 1,500 Supplies Expense 1,300 Utilities Expense 300 300 Wage Expense 1,000 1,870 Property Tax Expense 400 400 Insurance Expense _____ ______ 900 _____ Total $ 98,300 $ 98,300 $ 101,410 $ 101,410 Please solve asap. Thank you so much. Having each step explained would be most helpful as well.

On July 1, 2018, Gupta Corporation bought 30% of the outstanding common stock of VB Company for $170 million cash. At the date of acquisition of the stock, VB’s net assets had a total fair value of $490 million and a book value of $220 million. Of the $270 million difference, $50 million was attributable to the appreciated value of inventory that was sold during the last half of 2018, $160 million was attributable to buildings that had a remaining depreciable life of 10 years, and $60 million related to equipment that had a remaining depreciable life of 5 years. Between July 1, 2018, and December 31, 2018, VB earned net income of $60 million and declared and paid cash dividends of $50 million.

Required:
1. Prepare all appropriate journal entries related to the investment during 2018, assuming Gupta accounts for this investment by the equity method.
2. Determine the amounts to be reported by Gupta. (amounts in millions)