3 Transaction Description of transaction 4 01. June 1: Byte of Accounting, Inc. acquired $79,200 in cash from Lauryn and issued 3,600 shares of its common stock 02 June 1: Byte of Accounting, Inc. issued 2,600 shares of its common stock to deangelo clark after $24,420 in cash and computer equipment with a fair market value of $32,780 were received. 8 03. June 1: Byte of Accounting, Inc. issued 1,836 shares of its common stock after acquiring from Courtney $29,700 in cash, computer equipment with a fair market value of $10,120 and office equipment with a fair value of $572 10 04. June 2: A down payment of $27,000 in cash was made on additional computer equipment that was purchased for $135,000. A five-year note was executed by Byte for the balance. 11 12 05. June 4: Additional office equipment costing $400 was purchased on credit from Discount Computer Corporation. 13 14 06. June 8: Unsatisfactory office equipment costing $80 was returned to Discount Computer for credit to be applied against the outstanding balance owed by Byte 15 16 07. June 10: Byte paid $20,750 on the balance it owed on the June 2 purchase of computer equipment 17 18 19 08. June 14: A one-year insurance policy covering its computer equipment was purchased by Byte for $6,480 in cash. The effective date of the policy was June 16. 20 1 09. June 16: A check in the amount of $6,500 was received for consulting revenue. 10. June 16: Byte purchased a building and the land it is on for $113,000, to house its repair facilities and to store computer equipment. The lot on which the building is located is valued at $18,000. The balance of the cost is to be allocated to the building. Byte made a cash down payment of $11,300 and executed a mortgage for the balance. The mortgage is payable in eight equal annual installments beginning July 1. 11. June 17: Cash of $5,700 was paid for rent for June, July and August. Put the total amount into the Prepaid Rent account 25 26 27 28 12. June 17Received a bill of $475 from the local newspaper for advertising 29 13. June 21: Accounts payable in the amount of $320 were paid. 30 14. June 21: A fax machine for the office was purchased for $775 cash. 31 32 15. June 21: Billed various miscellaneous local customers $4,200 for consulting services performed. 33 34 16. June 22: Paid salaries of $1,035 to equipment operators for the week ending June 18. 35 36 17. June 22: Received a bill for $1,290 from Computer Parts and Repair Co. for repairs to the computer equipment 17 8 9 18. June 22: Paid the advertising bill that was received on June 17. 1 19. June 23: Purchased office supplies for $480 on credit. Record the purchase as an increase to the assets. 20. June 23: Cash in the amount of $3,365 was received on billings 21. June 28: Billed $5,280 to miscellaneous customers for services performed to June 25. 22. June 29. Paid the bill received on June 22, from Computer Parts and Repairs Co. 23. June 29. Cash in the amount of $5,001 was received for billings. 24. June 29: Paid salaries of $1,035 to equipment operators for the week ending June 25. 25. June 30: Received a bill for the amount of $1,015 from O&G Oil and Gas Co. 26. June 30: Paid a cash dividend of $0.15 per share to the three shareholders of Byte [IMPORTANT NOTE: The number of shares of capital stock outstanding can be determined from the first three transactions.] 57 58 Adjusting Entries - Round to two decimal places 27. The rent payment made on June 17 was for June July and August. Expense the amount associated with one month's rent. 59 60 28. A physical inventory showed that only $191,00 worth of office supplies remained on band as of June 30. 61 62 a 29. The annual interest rate on the mortgage payable was 7.75 percent. Interest expense for one-half month should be computed because the building and land were purchased and the liability incurred on June 16. 63 64 30. Information relating to the prepaid insurance may be obtained from the transaction recorded on June 14. Expense the amount associated with one half month's insurance. 65 66 31. A review of Byte's job worksheets show that there are unbilled revenues in the amount of $9,000 for the period of June 28-30. 67 68 69 70 71 72 32. The expense for depreciation follows: Building - $242.00 Computer Equipment. $3,047.00 Office Equipment - $22.00 73 74 33. A review of the payroll records show that unpaid salaries in the amount_$621.00 are owed by Byto for three days, June 28 - 30. 75 76 34. The note payable relating to the June 2, and 10 transactions is a five-year note, with interest at the rate of 12 percent annually. The June interest expense from this note is $869.67. 77 78 D 73 74 33. A review of the payroll records show that unpaid salaries in the amount of $621.00 are owed by Byte for three days, June 28 - 30. 75 76 34. The note payable relating to the June 2, and 10 transactions is a five-year note, with interest at the rate of 12 percent annually. The June interest expense from this note is $869.67. 77 78 79 81 35. Income taxes are to be computed at the rate of 25 percent of net income before taxes. [IMPORTANT NOTE: Since the income taxes are a percent of the net income you will want to prepare the Income Statements through the Net Income Before Tax line. The worksheet contains all of the accounts and their balances which you can then transfer to the appropriate financial statement.) 82 83 84 Closing Entries 85 86 36. Close the revenue accounts. 87 88 37. Close the expense accounts. 89 90 38. Close the income summary account 39. Close the dividends account 91 92 93 94 1 2 A Byte of Accounting, Inc. General Journal Note: You can only enter data into the yellow led cells 3 Transaction Date Account Name Description Debit Credit 01 Jun 01 02 03 04 05 06 07 08 09 1 C H 2 A Byte of Accounting, Inc. General Joumal Note: You can only enter data into the yellow filled cells 3 Transaction Date Account Name Debit Credit Description 10 11 12 13 4 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79 30 11 2 3 4 5 6 7 8 14 15 16 17 0 1 18 Ancians P Gener G H J 60 - E A Byte of Accounting, Inc. General Journal Note: You can only enter data into the yellow filled cells Transaction Date Account Name Description 95 96 Debit Credit 19 97 20 21 22 98 99 100 101 102 103 104 105 106 107 108 109 110 111 112 113 114 115 116 117 118 119 120 121 122 123 124 125 126 127 128 129 23 24 25 30 26 131 32 133 134 35 36 37 27 Introduction FAQ Welcome A Charol Accounts A Tali B C D E F H 1 2 A Byte of Accounting, Inc. General Journal Note: You can only enter data into the yellow filled cells 3 Credit 4 Transaction Date Account Name Description Debit 27 a 28 29 30 31 136 137 138 139 140 141 142 143 144 145 146 147 148 149 150 151 152 153 154 155 156 157 158 159 160 161 162 163 164 165 166 167 168 169 170 171 172 173 174 175 176 177 1781 32 33 34 35 1 H 1 2 A Byte of Accounting, Inc. General Journal Note: You can only enter data into the yellow filled cells 3 Transaction Date Account Name Description Debit Credit 36 37 -+ 177 178 179 180 181 182 183 184 185 186 187 188 189 190 191 192 193 194 195 196 197 198 199 200 201 202 203 204 205 206 207 208 209 210 38 39