Answered step by step
Verified Expert Solution
Question
1 Approved Answer
ACCT 601 Spring Semester, 2024 Final Exam Name 1. Prepare journal entries to record each of the following transactions. You do not need to write
ACCT 601 Spring Semester, 2024 Final Exam Name 1. Prepare journal entries to record each of the following transactions. You do not need to write explanations below the journal entries. 2. Create general ledger accounts for each account and post each of the journal entries to an existing general ledger account. 3. Prepare adjusting journal entries as you deem necessary. Besides the information provided for adjusting journal entries, review the transactions and review your unadjusted trial balance for any other adjusting journal entries you may need to prepare. 4. Post each of the adjusting journal entries to the general ledger accounts. 5. Prepare closing entries and post the entries to the general ledger accounts. 6. Prepare trial balances as you deem necessary. 7. Prepare the following financial statements, in their proper format, for the month of January Income statement O Statement of retained earnings O Balance sheet o Statement of Cash Flow (this is extra credit, worth 5 points)Shocker Electronics 1s a new company that distributes computer equipment to retail outlets. The following mnformation pertains to Shocker Electronics dunng their first month of operations: Supphiers sales price cost terms Xtreme -game systems 3.000.00 2.400.00 1% 15, net 30 HP -office systems 2.000.00 1,700.00 190/20, net/30 Gateway -home systems 900.00 720.00 2%/10, net/30 Customers Cuesta Computer terms 2%/10 net 30 Mustang Computer terms 2%/10 net 30 SLO CPU terms 2%/10 net 30 walk-1n customers cash only - no discount Jan 1 Jan 1 Jan 1 Jan 1 Jan 1 Jan 1 Jan 5 Issued 10,000 shares of $1 par value common stock for $15 per share. Made a $350.000 down payment and signed a $600.000 mortgage to purchase land and building, which will be used as the distribution center. The land comprised of three (3) lots which appraised at $132_000 each ($396.000 total) and the building appraised for $264 000. The building occupies one (1) lot, one (1) lot will serve as parking and WCD intends to sell the third lot. The loan 15 a ten (10) year, 8.0% mortgage requinng monthly payments consisting of principle and interest. The first payment 1s due Feb. 1= Please attach a loan amortization schedule. Issued 100 bonds with $1,000 face value and 6% coupon rate. The bonds mature 1n ten (10) years and pay interest semm-annually on July 1 and January 1st. The bonds sell at a price to yield an 8% effective interest rate. The effective mterest method will be used to amortize the bond premium or discount. Please attach a bond amortization schedule. Borrowed $100,000 from First Bank to purchase shelving for the warehouse. The shelving cost $100,000 and is expected to last five (3) years. The note 1s a three (3) year, 9% note that requires principle and mterest payments on the last day of each month. Please attach a loan amaortization schedule Purchase inventory 150 systems from Gateway at $720 per system terms 2%/10, net/30 100 systems from HP at $1,700 per system terms 1%0/20, net/30 40 systems from Xtreme at $2,400 per system terms 1% 135, net 30 Paid $1,000 for supplies. Sold Cuesta Computer sixty (60) Gateway sytstems and forty (40) HP systems, on account. Jan 6 Paid Gateway bill in full (in the discount period) Jan 10 Sold SLO CPU twenty-five (25) Xtreme systems. Jan 14 Received payment in full from Cuesta Computer (in the discount period). Jan 14 Sold Mustang Computer fifty (50) Gateway sytstems and fifty (50) HP systems. Jan 14 Paid HP bill in full (in the discount period) Jan 15 Purchase inventory 75 systems from Gateway at $720 per system terms 2%/10, net/30 50 systems from HP at $1,700 per system terms 1%/20, net/30 25 systems from Xtreme at $2,400 per system terms 1%/15, net 30 Jan 16 Paid salaries totaling $5,000 for the first half of the month. In order to make this entry you must know that 15% was withheld for federal income tax, 5% was withheld for state income tax, 7.65% (6.2% social security and 1.45% medicare) was withheld for FICA. Don't forget that the employer is also responsible for matching the employee's contribution to FICA. All taxes, both the employee's and employer's, are paid quarterly throughout the year. Jan 20 Sold Cuesta Computer forty (40) Gateway systems and forty (40) HP systems, on account. Jan 22 Sold SLO CPU twenty-five (25) Xtreme systems. Jan 23 Received payment in full from Mustang Computers (in discount period). Jan 24 Paid Gateway bill in full (in the discount period) Jan 25 Received payment in full from SLO CPU. The first invoice was out of discount period and the second invoice was in the discount period. Jan 27 Sold the extra parcel of land, which was held as an investment, for $125,000. Jan 28 Paid Xtreme bill in full (first invoice out of the discount period) Paid Xtreme bill in full (second invoice in the discount period) Jan 29 Paid HP bill in full (in the discount period)Jan 29 Received payment in full from Cuesta Computer (in the discount period). Jan 30 Sold Mustang Computer fifty (50) Gateway systems and ten (10) HP systems. Additional information Accounts Receivable: Accounts receivable are evaluated at the end of each month. It is estimated that 2% of all accounts receivable will not be collected. Inventory: The weighted average cost method is used to value product purchased from each supplier. By that I mean that the purchase price does not change by supplier, but you need to factor in any discounts that are taken. Therefore, you will have to calculate inventory values and cost of goods sold on a weighted average basis by items purchased from supplier. A periodic inventory system is utilized Depreciation on: building - 20 years, straight-line, no salvage value. shelving - 5 years, double declining balance, no salvage value Supplies worth $175 are on hand at the end of the month Accrue salaries for the second half of the month (same amount as Jan. 16th salaries). These salaries will be paid on February 1st.20-Jan Accounts Recievable 116,000.00 Sales 116,000.00 Cost of Goods Sold 96,800.00 Inventory 96,800.00 22-Jan Accounts Recievable 75,000.00 Sales 75,000.00 Cost of Goods Sold 60,000.00 Inventory 60,000.00 23-Jan Cash 142,100.00 Sales Discount 2,900.00 Accounts Recievable 145,000.00 24-Jan Accounts Payable 54,000.00 Cash 52,920.00 Inventory 1,080.00 25-Jan Cash 148,500.00 Sales Discount 1,500.00 Accounts Recievable 150,000.00 27-Jan Cash 125,000.00 Loss on Land Sale 7,000.00 Accounts Recievable 132,000.00 28-Jan Accounts Payable 156,000.00 Cash 155,400.00 Inventory 600.00 29-Jan Accounts Payable 85,000.00 Cash 84,150.00 Inventory 850.00 29-Jan Cash 113,680.00 Sales Discount 2,320.00 Accounts Recievable 116,000.00 30-Jan Accounts Recievable 65,000.00 Sales 65,000.00 Cost of Goods Sold 53,000.00 Inventory 53,000.00 31-Jan Bad Debts Expense 1,300.00 Allowance for Bad Debts 1,300.00 Supplies Expense 825.00 Supplies 825.00 Salaries Expense 5,000.00 Salaries Payable 5,000.00 Depreciation Expense - Building 1,100.00 Deprecation Expense - Shelving 3,333.33 Accumulated Depreciation - Building 1,100.00 Accumulated Depreciation - Shelving 3,333.33Entry # General Ledger Account Debit Credit 1-Jan Cash 150,000.00 Common Stock 10,000.00 Paid In Capital 140,000.00 1-Jan Land (3 lots) 390,000.00 Building 260,000.00 Cash 50,000.00 Mortgage Payable 600,000.00 1-Jan Cash 100,000.00 Bonds Payable 100,000.00 1-Jan Shelving 100,000.00 Notes Payable 100,000.00 1-Jan Inventory 374,000.00 Accounts Payable 374,000.00 1-Jan Supplies 1,000.00 Cast 1,000.00 5-Jan Accounts Recievable 134,000.00 Sales 134,000.00 Cost of Goods Sold 111,200.00 Inventory 111,200.00 6-Jan Accounts Payable 108,000.00 Cash 105,840.00 Inventory 2,160.00 10-Jan Accounts Recievable 75,000.00 Sales 75,000.00 Cost of Goods Sold 60,000.00 Inventory 60,000.00 14-Jan Cash 131,320.00 Sales Discount 2,680.00 Accounts Recievable 134,000.00 14-Jan Accounts Recievable 145,000.00 Sales 145,000.00 Cost of Goods Sold 121,000.00 Inventory 121,000.00 14-Jan Accounts Payable 170,000.00 Cash 168,300.00 Inventory 1,700.00 15-Jan Inventory 199,000.00 Accounts Payable 199,000.00 16-Jan Salaries Expense 5,000.00 FICA Tax Expense 382.50 Federal Income Tax Payable 750.00 State Income Tax Payable 250.00 FICA Tax Payable 765.00 Cash 3,617.50 20-Jan Accounts Recievable 116,000.00 Sales 116,000.00 Cost of Goods Sold 96,800.00 Inventory 96,800.00 22-Jan Accounts Recievable 75,000.00 Sales 75,000.00 Cost of Goods Sold 60,000.00 Inventory 60,000.00
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started