1. Please journalize the following transactions for December 2011, complete T-accounts for those transactions and update the trial balance

2. repeat for the adjusting entries and finalize the trial balance

3. construct an income statement, statement of retained earnings, and balance sheet

Transactions during December:

1. Products in the amount of $1,000,000 were sold of which $350,000 were paid for in cash. The cost of these good was $500,000

2. Products were purchased on credit for 240,000

3. Payroll in the amount of $222,480 was paid

4. returns and allowances of $35,000 were received. Their cost was $17,500

5. Discounts of 3% were given to $400,000 of the accounts receivable collected during December

6. A note was taken out in the amount of $90,000 on Dec. 1, 2017 at 7% for 2 years

7. $200,000 was paid on the current accounts payable

8. Supplies were purchased on account for $7,500

9. Prepaid insurance for 2 years was bought on December 1 for $25,000

Adjustments:

1. The building has a 40 year useful life and a $140,320 residual value. Calculate and journalize the depreciation. This building is currently being paid off

2. The equipment has a residual value of $24,710 and a useful life of 16 years. Calculate and journalize the depreciation

3. A note was taken out on October 1, 2011 in the amount of $600,000 at 8% and to be paid in full including interest on May 1, 2012 (next year). Make adjustments for year end

4. Outstanding income tax of $135,000 has not been recorded

5. An additional building was purchased with a mortgage. Mortgage payable for the year was $1,000,000. The current portion due was $100,000

6. Unearned revenue was earned during the month of December

7. During the last pay period in December a payroll of 7 days was earned with 3 days of the period left in the New Year. If the payroll was $10,000, record the year-end payroll

8. Dividends were issued in the amount of $5,000

9. Prepaid insurance expired for the month of December

10. The ending balance of supplies was $2,000