Question
ACC 502A Week 3 Accounting Cycle Problem Bluemark Health Care Inc. is owned and operated by Dr. George Hancock, the sole stockholder. Bluemark's January 1,
| ACC 502A Week 3 Accounting Cycle Problem | |||||||||
| Bluemark Health Care Inc. is owned and operated by Dr. George Hancock, the sole stockholder. | |||||||||
| Bluemark's January 1, 2017 trial balance appears below. | |||||||||
| Bluemark Health Care, Inc. | |||||||||
| Trial Balance | |||||||||
| January 1, 2017 | |||||||||
| Account |
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| Debit | Credit | |||||
| Cash | 30,000 | ||||||||
| Accounts Receivable | 50,000 | ||||||||
| Prepaid Insurance | - | ||||||||
| Supplies | 2,000 | ||||||||
| Building | 330,000 | ||||||||
| Accumulated Depreciation | 40,000 | ||||||||
| Land | 150,000 | ||||||||
| Accounts Payable | 33,500 | ||||||||
| Unearned Rent Revenue | - | ||||||||
| Wages Payable | - | ||||||||
| Interest Payable | - | ||||||||
| Notes Payable | 200,000 | ||||||||
| Capital Stock | 50,000 | ||||||||
| Retained Earnings | 238,500 | ||||||||
| Dividends | - |
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| Income Summary | |||||||||
| Service Revenue | - | ||||||||
| Rent Revenue | - | ||||||||
| Wages Expense | - | ||||||||
| Utilities Expense | - | ||||||||
| Rent Expense | - | ||||||||
| Interest Expense | - | ||||||||
| Miscellaneous Expense | |||||||||
| Advertising Expense | - | ||||||||
| Supplies Expense | - | ||||||||
| Insurance Expense | - | ||||||||
| Depreciation Expense | - | ||||||||
| 562,000 | 562,000 | ||||||||
| Bluemark Health Care completed the following transactions during January 2017: | |||||||||
| Trans #/Date | Description | ||||||||
| # 1 - Jan 1 | Received $18,000 from Rivers Company as rent for the use of a vacant office in Bluemark | ||||||||
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| Health Care's building. Rivers paid rent six months in advance (hint: credit unearned rent revenue). | ||||||||
| #2 - Jan 1 | Paid $27,000 for an insurance premium on a general business policy. This payment | ||||||||
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| was debited to Prepaid Insurance. |
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| #3 - Jan 6 | Purchased supplies of $5,000 on account. |
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| #4 - Jan 9 | Collected $25,000 for services provided to customers on account. |
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| #5 - Jan 11 | Paid creditors $17,000 on account. |
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| #6 - Jan 18 | The sole shareholder invested an additional $120,000 in the business in exchange for | ||||||||
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| capital stock. |
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| #7 - Jan 20 | Billed patients $120,000 for services provided on account. |
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| #8 - Jan 25 | Received $24,500 for services provided to customers who paid cash. |
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| #9 - Jan 30 | Paid cash for expenses as follows: wages, $51,000, utilities, $6,000, rent on medical | ||||||||
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| equipment, $7,600, miscellaneous, $500, and advertising, $3,500. |
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| #10 - Jan 30 | Paid dividends of $15,000 to stockholders (Dr. Hancock). |
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| #11 - Jan 30 | Received $80,000 cash from customers in payment of services billed on Jan 20. |
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| January 31, 2017 Bluemark Health Care adjustment data appears below: | |||||||||
| Adjust A | $4,500 of the prepaid insurance expired during January. | ||||||||
| Adjust B | $3,500 of supplies were on hand on January 31. (hint: check the unadj supplies bal first). | ||||||||
| Adjust C | January depreciation on building was $1,200. | ||||||||
| Adjust D | $3,000 of unearned rent revenue was earned. | ||||||||
| Adjust E | Wages owed employees but not paid was $10,100. | ||||||||
| Adjust F | Services provided but not yet billed to patients was $12,000. | ||||||||
| Adjust G | There was $2,000 in interest payable on 1/31/15 related to the $200,000 notes payable. | ||||||||
| Requirements: | |||||||||
| 1 | Under "Journal Entries" in the "journal, adjust & close entries" worksheet, prepare | ||||||||
| journal entries for the 11 transactions in January 2017. | |||||||||
| 2 | Post (enter) the journal entries from (1) to the Ledger (T-Accounts) in the "Ledger" worksheet. | ||||||||
| (Beginning balances have already been entered in the Ledger accounts.) | |||||||||
| 3 | Under "Adjusting Entries" in the "journal, adjust & close entries" worksheet, prepare the | ||||||||
| adjusting entries A through G. | |||||||||
| 4 | Post (enter) the adjusting entries from (3) to the Ledger (T-Accounts) in the "Ledger" worksheet. | ||||||||
| 5 | Prepare the adjusted trial balance in the "adjusted and post trial balance" worksheet by | ||||||||
| transferring the adjusted ending balances from the "Ledger" worksheet. | |||||||||
| 6 | Prepare an income statement and retained earnings statement for January 2017 and a | ||||||||
| January 31, 2017 balance sheet in the "financial statements" worksheet using the ending balances | |||||||||
| from the adjusted trial balance. | |||||||||
| 7 | Prepare closing entries at January 31, 2017 (in the "journal, adjust & close entries" worksheet) as follows: | ||||||||
| (1) Close revenue to Income Summary Account | |||||||||
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| (2) Close expenses to Income Summary Account | ||||||||
| (3) Close Income Summary Account to Retained Earnings | |||||||||
| (4) Close Dividends to Retained Earnings | |||||||||
| 8 | Post (enter) closing entries from (7) to the Ledger (T-Accounts) in the "Ledger" worksheet. | ||||||||
| Then prepare a January 31, 2017 post-closing trial balance in the "adjusted and post trial balance" worksheet | |||||||||
| by transferring the final balances from the "Ledger" worksheet. | |||||||||
| (Note: there should be no income statement accounts appearing on the post-closing trial balance because | |||||||||
| the income statement accounts should all have zero balances.) | |||||||||
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The Internal Audit As Change Agent The Activation And Successful Implementation Of Organizational Change
Authors: Peter Kundinger
3rd Edition
3751984070, 978-3751984072
