Acc 300

Practice set 1

Required:

Journalize the transactions

Post to ledger (T accounts)

Prepare Trial Balance

Journalize the adjusting entries

Post to the ledger

Prepare Adjusted Trial Balance

Prepare the four financial statements

Net income equals $11,583

Purchased inventory on account $23,000

Sales on account $35,000

Cash Sales $22,000

Paid salaries $6,000

Purchased supplies on account for $500

Cash collected from customers $19,000

Purchased inventory for cash $13,000

Wrote off customer account as uncollectable $300

Made payment on account $18,000, received a 2% discount

Declared dividend to be paid next month $5,000

A piece of equipment costing $600 was stolen. The insurance company reimbursed the company $300. The accumulated depreciation on the equipment amounted to $250

New equipment purchased for $1200 cash

The short term note payable was paid. The note was for 30 days with 6% interest. (No interest has been accrued.)

Adjustments

It is estimated that 10% of accounts receivable is uncollectable

Supplies used $2,800

Depreciation Expense $650

Our employees are owed $740 at the end of the month

Interest on the note payable is 6%

Ending inventory is $35,000

$1,000 of prepaid insurance has expired

The income tax rate is 25% (round to the nearest dollar)

Beginning Trial Balance

Cash	3,700
Accounts Receivable	12,000
Allowance for Doubtful Accounts		2,400
Supplies	4,000
Prepaid Insurance	2,100
Inventory	29,500
Buildings	40,000
Equipment	10,000
Accumulated Depreciation		15,000
Accounts Payable		3,300
Salaries Payable		600
Note Payable		1,200
interest payable		250
Note Payable (Due in 18 months)		20,000
Common Stock		40,000
Retained Earnings		18,550
	101,300	101,300