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AAA Skateboards sells skateboards to large sporting goods stores in Canada. It also repairs skateboards During 2021 the following transactions occurred at AAA Skateboards. 1.
AAA Skateboards sells skateboards to large sporting goods stores in Canada. It also repairs skateboards During 2021 the following transactions occurred at AAA Skateboards. 1. During the year, purchased inventory for cash $250,000. 2. Sold skateboards for $680,000 on account and $72,000 for cash. The inventory that was sold cost AAA $415,000 in 2020. 3. Paid $33,000 to suppliers, to settle some of the accounts payable. 4. Issued 1,000 common shares for $36,000. 5. A customer ordered $160,000 of skateboards and provided a $32,000 deposit. The skateboards were expected to be delivered by the end of the year. The cost to AAA for these skateboards was $72,000 in 2020. 6. Performed skateboard repairs for customers for a total of $60,000. Half of the customers paid in cash and the remainder received their repair services on account. 7. Received $410,000 from customers in settlement of amounts owed to the company. 8. AAA received a $300,000 three-year bank loan on September 30. Interest and principal are due in three years. The annual interest rate is 12%. $6,000 interest was accrued and recorded on this loan. 9. Paid $6,000 of interest on another short-term loan that had been accrued and paid $120,000 which was the outstanding principal of the loan. 10. Depreciation on equipment for the year was 15,000. 11. Paid $11,000 for telephone expenses for the year. There was $1,000 that was not yet paid as it was due in January 2022. 12. A dividend declared in 2020 of $8,000 was paid in March 2021. 13. AAA provided a $4,500 deposit to a painting company who would paint the office in February 2022. The price to paint the office is $12,000. 14. The skateboards in #5 above were delivered to the customer. 15. Declared and paid dividends of $18,000 in December (a) Prepare journal entries to record the above items (b) Calculate the yearend (December 31,2021) cash balance if the beginning cash was $2,200,000
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