Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

1. The most recent bank statement reports a balance of $48,770. Included with the bank statement was a $2,100 check from Iggy Smarts, a professional

image text in transcribed
image text in transcribed
image text in transcribed
1. The most recent bank statement reports a balance of $48,770. Included with the bank statement was a $2,100 check from Iggy Smarts, a professional musician, charged back to Music Is Us as NSF. The bank's monthly service charge was $30. Three checks written by Music-Is-Us to suppliers of merchandise inventory had not yet cleared the bank for payment as of the statement date. These checks included: no. 508. $3,700, no. 511. $9.200; and no. 521, $8,400. Deposits of $16,400 reached the bank too late for inclusion in the current bank statement. The company prepares a bank reconciliation at the end of each month. 2. Music-Is-Us has a portfolio of marketable securities that originally cost $27000. As of December 31, the market value of these securities was $35.100. All short-term investments are classified as "available for sale." 3. During December, $5,900 of accounts receivable were written off as uncollectible. A recent aging of the company's accounts receivable led management to conclude that an allowance for doubtful accounts of $8,300 is needed at December 31, 2021. 4. The company uses a perpetual Inventory system. A year-end physical count revealed that several guitars reported in the inventory records were missing. The cost of the missing units amounted to $1400. This amount is not considered significant relative to the total cost of inventory on hand. 5. At December 31, approximately $900 in office supplies remained on hand. 6. The company pays for its insurance policies 12 months in advance. Its most recent payment was made on November 1, 2021. The cost of this policy was slightly higher than the cost of coverage for the previous 12 months 7. Depreciation expense related to the company's building and fixtures is $4.000 for the month ending December 31, 2021 8. Although Music is Us carries an extensive Inventory, it is not uncommon for experienced musicians to order custom guitars made to their exact specifications Manufacturers do not allow any sales returns of custom-made guitars. The entire sales amount is collected at the time a custom order is placed, and is credited to an account entitled "Unearned Customer Deposits." As of December 31, $4,600 of these deposits remained unfilled because the special order guitars have not been recelved from the manufacturer. The cost of goods sold and the reduction in inventory associated with all custom orders is recorded when the custom merchandise is delivered to customers. At that time, the adjusting entry requires only a decrease to unearned customer deposits and an increase in sales, 9. Accrued income taxes payable for the entire year ending December 31, 2021, total $81000. No income tax payments are due until early in 2022 Journal entry worksheet

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Audit Analytics In The Financial Industry

Authors: Jun Dai

3rd Edition

1787430863, 9781787430860

More Books

Students also viewed these Accounting questions

Question

Discuss therapeutic applications of motivational interviewing.

Answered: 1 week ago

Question

Evaluate the integral. 2 - (4ti tj + 2tk) dt 0

Answered: 1 week ago