A C D E 3 Transaction 01. Description of transaction June 1: Byte of Accounting, Inc. issued 2,690 shares of its common stock to Jeremy after 524,640 in cash and computer equipment with a fuir market value of $34,540 were received. 4 5 02. 6 June 1: Byte of Accounting, Inc. issued 1,865 shares of its common stock after acquiring from Courtney $29,700 in cash, computer equipment with a fair market value of $10,560 and office equipment with a fair value of $770 June 1: Byte of Accounting, Inc. acquired $79,200 in cash from Madison McFadden and issued 3,600 shares of its common stock. 03. 8 04. 10 11 05. 12 13 06. 14 15 16 17 June 2: A down payment of $28,000 in cash was made on additional computer equipment that was purchased for $140,000. A five-year note was executed by Byte for the balance. June 4: Additional office equipment costing $300 was purchased on credit from Discount Computer Corporation June 8: Unsatisfactory office equipment costing 560 was returned to Discount Computer for credit to be applied against the outstanding balance owed by Byte June 10: Byte paid $21,500 on the balance it owed on the June 2 purchase of computer equipment. June 14: A one-year insurance policy covering its computer equipment was purchased by Byte for $6,144 in cash. The effective date of the policy was June 16. June 16: Computer consultation revenue of $6,500 was received. 07. 08. 18 19 09. 20 21 10. June 16: Byte purchased a building and the land it is on for $107,000, to house its repair facilities and to store computer equipment. The lot on which the building is located is valued at $17,000. The balance of the cost is to be allocated to the building. Byte made a cash down payment of $10,700 and executed a mortgage for the balance. The mortgage is payable in cight equal annual installments beginning July 1 22 23 11. Juno 17: Cash of $5,100 was paid for rent for June, July and Augute Put the total amount into the Prepaid Rent account 12. June 17: Received a bill of $425 from the local newspaper for advertising 24 25 26 27 28 29 13 June 21: Billed various miscellaneous local customers $4,900 for consulting services performed B23 xvf D 14. June 21: A fax machine for the office was purchased for $675 cash. 15. June 21: Accounts payable in the amount of $240 were paid. 30 31 32 33 34 35 16. June 22: Paid the advertising bill that was received on June 17 June 22: Received a bill for $1,240 from Computer Parts and Repair Co. for repairs to the computer equipment 17. 30 37 38 39 40 18. June 22: Paid salaries of $1,010 to equipment operators for the week ending June 18, 19. 20. 21. 22 41 42 43 44 45 40 47 40 49 30 61 $2 June 23: Cash in the amount of $3,925 was received on billings. June 23: Purchased office supplies for $680 on credit. Record the purchase as an increase to the assets. June 28: Billed $6,015 to miscellaneous customers for services performed to June 25. June 29: Cush in the amount of $5,699 was received for billings June 29: Paid the bill received on June 22, from Computer Parts and Repairs Co. June 29: Paid salaries of $1,010 to equipment operators for the week ending June 25. June 30: Received a bil for the amount of $890 from O&G Oil and Gas Co. 23 24. 25. 26. June 30: Paid a cash dividend of 80.22 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 54 55 58 57 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 58 59 50 61 28 A physical inventory showed that only $281.00 worth of office supplies remained on hand as of June 30. 29. The annual interest rate on the mortgage payable was 9.25 percent. Interest expense for one-half month should be computed because the building and land were purchased and the liability incurred on June 16. 62 63 B c D E 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 64 65 31. A review of Byte's job worksheets show that there are unbilled revenues in the amount of $5,625 for the period of June 28-30 32 66 67 68 69 70 71 The fixed assets have estimated useful lives as follows: Building - 31.5 years Computer Equipment - 5.0 years Office Equipment - 7.0 years Use the straight-line method of depreciation Management has decided that assets purchased during a month are treated as if purchased on the first day of the month. The building's scrap value is 57,000. The office equipment has a scrap value of $400. The computer equipment has no scrap value. Calculate the depreciation for one month. 72 73 33. A review of the payroll records show that unpaid salaries in the amount of S606 are owed by Byte for three days, June 28 - 30. 74 75 34 76 77 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. Interest expense should be computed based on a 360 day year. (IMPORTANT NOTE: The original note on the computer equipment purchased on June 2 was $112,000, On June 10, eight days later, $21,500 was repaid. Interest expense must be calculated on the S112,000 for eight days. In addition, interest expense on the 590,500 balance of the lonn ($112,000 less $21,500 - $90,500) must be calculated for the 20 days remaining in the month of June) 78 70 & 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. Closing Entries 36. Close the revenue accounts 81 B2 B3 84 85 BG 87 88 B9 30 37 Close the expense accounts 38 Close the income summary account 01 90 Trine Think Anton Works B D E H 1 A Byte of Accounting, Inc. General Journal N 2 3 Note: You can only enter data into the yellow led Date Account Transaction Name Description Debit Credit 01 02 03 04 4 5 6 7 8 9 10 11 12 13 14 15 10 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 05 06 + 07 OS 45 FAO Welcome Chart of Accounts Transactions General Journal Worksheet Ready c D H E F G A Byte of Accounting, Inc. Worksheet For Perlod Ending January 0, 1900 2 3 Unadjusted Trial Balance Debit Credit Adjusting Entries Debit Credit Adjusted Trial Balance Debit Credit . 4 5 6 Ad zount 7 Number Name 8 1110 Cash 9 1120 Accounts Recolvable 10 1130 Prepaid Insurance 11 1140 Prepaid Rent 12 1150 Office Supplies 13 1211 Office Equip 14 1212 Acoum. Depr.Office Equip 15 1311 Computer Equip. 16 1312 Accum. Depr. Computer Equip 17 1411 Building Cost 18 1412 Accum. Depr.-Building 19 1510 Land 20 2101 Accounts Payable 21 2102 Advanced Payments 22 2103 Interest Payable 23 2105 Salarios Payable 24 2106 Income Taxes Payable 25 2201 Mortgage Payable 26 2202 Notos Payable 27 3100 Capital Stock 28 3200 Retained Earnings 29 3300 Dividends 30 31 4100 Computer & Consulting Revenue 32 5010 Rent Expense 33 5020 Salary Expense 34 5030 Advertising Expense 35 5040 Repairs & Maint. Expanse 36 5050 O & Gas Expense 37 5080 Supplies Expense 38 5090 Interest Expense 39 5100 Insurance Expense 40 5110 Depreciation Expono 5120 Income Tax Expense 42 43 44 45 48 47 TOTAL 48 FAQ Welcome - Chart of Accounts Transactions General Journal Worksheet Incor Road A Byte of Accounting, Inc. Income Statement For Month Ending January 0, 1900 DOWN Revenues Computer & Consulting Revenue 8 9 10 11 12 13 14 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 Expenses Rent Expense Salary Expense Advertising Expense Repairs & Maint. Expense Oil & Gas Expanse Supplies Exponso Interest Expense Insurance Expense Depreciation Expense Total Expenses Net Income Before Tax Income Tax Expense demand to the devinat placeres Net Income After Tax 58 B C D A E A Byte of Accounting, Inc. Statement of Changes in Retained Earnings For Month Ending January 0, 1900 Total Balance, Beginning of Period Net Income Dividends Balance, End of Period G A Byte of Accounting, Inc. Balance Sheet As of January , 1900 Aasta Current Assete Cast Accounts Receivable Prepaid Insurance Prepaid Rent Office Supplies Total Long-Term Assets Olice Equio Accum. Depr.Office Equip Computer Equip Accum. Depr. Computer Equip Building Cost Actum. Depr.Building Land Total Total Assets Liabilities Current Liabilities Accounts Payable Advanced Payment Interest Payable Salaries Payable Income Taxes Payable Total Long Term Liabilities Mortgage Payable Noles Payable Tota Total Liabilities Stockholder's Equity Captik Retained Curtis TotalLlables and Stockholders Equity