BUS312A/612AFinancial Reporting I
Homework 9.10.2014 & 9.15.2014The Accounting Cycle – Review
Chapter 3
E3-1 (Transaction Analysis-Service Company) During the first month of operations of her business (a sole proprietorship), the following events and transactions occurred.
Instructions Journalize the transactions in the general journal.
April 2 Invested $32,000 cash and equipment valued at $14,000 in the business.
2 Hired a secretary-receptionist at a salary of $290 per week payable monthly.
3 Purchased supplies on account $700. (Debit an asset account.)
7 Paid office rent of $600 for the month.
11 Completed a tax assignment and billed client $1,100 for services rendered. (Use Service Rev)
E3-1 (Transaction Analysis-Service Company) During the first month of operations of her business (a sole proprietorship), the following events and transactions occurred.
April 12 Received $3,200 advance on a management consulting engagement.
17 Received cash of $2,300 for services completed for Ferengi Co.
21 Paid insurance expense $110.
30 Paid secretary-receptionist $1,160 for the month.
30 A count of supplies indicated that $120 of supplies had been used.
30 Purchased a new computer for $6,100 with personal funds. (The computer will be used exclusively for business purposes.)
E3-17 March transactions:
March 1 Invested $50,000 cash for common stock
3 Purchased real estate for $38,000 cash (land $10,000, building 22,000, equipment 6,000)
5 Paid $1,600 to advertise the driving range & golf course
6 Paid $1,480 for a one-year insurance policy
10 Purchased golf equipment for $2,500 from Singh Company, payable in 30 days
E3-17 March transactions:
March18 Received golf fees of $1,200 in cash
25 Declared and paid a $500 cash dividend
30 Paid wages of $900
30 Paid Singh Company in full
31 Received $750 in cash for golf fees.
Adjusting & Reversing Entries: 4 Kinds
Adjusting & Reversing Entries: 4 Kinds
E3-6 (Adjusting Entries) Karen Weller, D.D.S., opened a dental practice on January 1, 2014.
During the first month of operations the following transactions occurred.
1. Performed services for patients who had dental plan insurance. At January 31, $750 of such services was earned but not yet billed to the insurance companies.
2. Utility expenses incurred but not paid prior to January 31 totaled $520.
3. Purchased dental equipment on January 1 for $80,000, paying $20,000 in cash and signing a $60,000, 3-year note payable. The equipment depreciates $400 per month. Interest is $500 per month.
Instructions Prepare the adjusting entries on January 31. Account titles are: Accumulated Depreciation-Dental Equipment; Depreciation Expense; Service Revenue; Accounts Receivable; Insurance Expense; Interest Expense; Interest Payable; Prepaid Insurance; Supplies; Supplies Expense; Utilities Expense; and Utilities Payable.
E3-6 (Adjusting Entries) Karen Weller, D.D.S., opened a dental practice on January 1, 2014.
During the first month of operations the following transactions occurred.
4. Purchased a one-year malpractice insurance policy on January 1 for $12,000.
5. Purchased $1,600 of dental supplies. On January 31, determined that $500 of supplies were on hand.
Instructions Prepare the adjusting entries on January 31. Account titles are: Accumulated Depreciation-Dental Equipment; Depreciation Expense; Service Revenue; Accounts Receivable; Insurance Expense; Interest Expense; Interest Payable; Prepaid Insurance; Supplies; Supplies Expense; Utilities Expense; and Utilities Payable.
Adjusting entries:
1. The balance in prepaid insurance is a one-year premium paid on June 1, 2014.
2. An inventory count on August 31 shows $450 of supplies on hand.
3. Annual depreciation rates are cottages (4%) and furniture (10%). Salvage value is estimated to be 10% of cost.
4. Unearned Rent Revenue of $3,800 was earned prior to August 31.
5. Salaries of $375 were unpaid at August 31.
6. Rentals of $800 were due from tenants at August 31.
7. The mortgage interest rate is 8% per year.
E3-10 (Adjusting Entries) Greco Resort opened for business on June 1 with eight air-conditioned units. Its trial balance on August 31 is as follows.
Cash $ 19,600
Prepaid Insurance 4,500
Supplies 2,600
Land 20,000
Buildings 120,000
Equipment 16,000
Accounts Payable $ 4,500
Unearned Rent Revenue 4,600
Mortgage Payable 60,000
Common Stock 91,000
Retained Earnings 9,000
Dividends 5,000
Rent Revenue 76,200
Salaries and Wages Expense 44,800
Utilities Expenses 9,200
Maintenance and Repairs Expense 3,600
$245,300 $245,300
Adjusted Trial Balance-Greco Resorts--WORKSHEET
Cash $ 19,600
Prepaid Insurance 4,500
Supplies 2,600
Land 20,000
Buildings 120,000
Equipment 16,000
Accounts Payable $ 4,500
Unearned Rent Revenue 4,600
Mortgage Payable 60,000
Common Stock 91,000
Retained Earnings 9,000
Dividends 5,000
Rent Revenue 76,200
Salaries and Wages Expense 44,800
Utilities Expenses 9,200
Maintenance and Repairs Expense 3,600
Insurance Expense
Supplies Expense
Depreciation Expense-Building
Depreciation Expense-Equipment
Interest Expense
$245,300 $245,300
4 Closing Entries: Income Statement and Dividend Accounts
2 Closing Entries: Income Statement and Dividend Accounts
E3-16 Closing Entries for a Corporation
Ending Inventory $60,000
Common Stock 75,000
Retained Earnings 45,000
Dividends 18,000
Sales Returns & Allowances
12,000
Sales Discounts 15,000
Sales Revenue 410,000
Cost of Goods Sold 225,700
Selling Expenses 16,000
Administrative Expenses 38,000
Income Tax Expense 30,000