1. On Nov 30, 2016, the Zu company had the following account balance Account Balance Account Cash $3,200 Account payable Accounts receivable 9,900 Long term liabilities Inventories 10,600 Total liabilities Other current assets 2,000 Building and equipment (net) 42,000 Common stock Land 7,000 Retained earnings Total assets 74,700 Total liabilities and equities Balance $10,700 3,600 14,300 20,000 40,400 74,700 Assume the company has a balance of $150,000 on revenue and $145,000 on expense account, as well as $5000 on dividend account. During the month of December, the Zu company entered into the following transactions: Date Dec 1 4 7 11 14 18 20 22 30 Transaction Prepaid insurance for 12-month at $2,400 Made cash sales of $3,000 at the cost of $2,000 Purchased $2,400 of merchandise on credit. Paid $50 of related freight charge (expenses) Sold land for $7.800; the land has a cost $5,000 Made credit sale of $4,000 at the cost of $2.500 Purchased $1,250 of merchandise for cash Paid $1,600 of accounts payable Paid selling and administrative expenses in cash $1,500 Collected $4000 from the customer on the transaction made on Dec 14 Depreciation expense of $1,200 was recognized for Dec Purchased land at a cost of $7,000 made a $1,000 down payment and signed a 12%, 2-year note for the balance 31 31 1. Prepare general journal entries to record the preceding transactions 2. Post to the general ledger accounts 3. Prepare the income statement and balance sheet assuming the company is income tax exempt and all net income was retained in the business. Use the table below as a guide for part 1. Hint: The last line for each date in the table is for the transaction explanation and the remaining lines above it are for the account titles. Example is shown for December 1st. 1. On Nov 30, 2016, the Zu company had the following account balance Account Balance Account Cash $3,200 Account payable Accounts receivable 9,900 Long term liabilities Inventories 10,600 Total liabilities Other current assets 2,000 Building and equipment (net) 42,000 Common stock Land 7,000 Retained earnings Total assets 74,700 Total liabilities and equities Balance $10,700 3,600 14,300 20,000 40,400 74,700 Assume the company has a balance of $150,000 on revenue and $145,000 on expense account, as well as $5000 on dividend account. During the month of December, the Zu company entered into the following transactions: Date Dec 1 4 7 11 14 18 20 22 30 Transaction Prepaid insurance for 12-month at $2,400 Made cash sales of $3,000 at the cost of $2,000 Purchased $2,400 of merchandise on credit. Paid $50 of related freight charge (expenses) Sold land for $7.800; the land has a cost $5,000 Made credit sale of $4,000 at the cost of $2.500 Purchased $1,250 of merchandise for cash Paid $1,600 of accounts payable Paid selling and administrative expenses in cash $1,500 Collected $4000 from the customer on the transaction made on Dec 14 Depreciation expense of $1,200 was recognized for Dec Purchased land at a cost of $7,000 made a $1,000 down payment and signed a 12%, 2-year note for the balance 31 31 1. Prepare general journal entries to record the preceding transactions 2. Post to the general ledger accounts 3. Prepare the income statement and balance sheet assuming the company is income tax exempt and all net income was retained in the business. Use the table below as a guide for part 1. Hint: The last line for each date in the table is for the transaction explanation and the remaining lines above it are for the account titles. Example is shown for December 1st