At the beginning of April 2024, Jordan Song incorporated an architectural firm named Jordan Song & Associates Ltd. (the corporate entity is referred to as JSA hereafter). JSA plans to use April 30 for the end of their fiscal period, so you only need statements for the first month of operations. Jordan heard that you are taking a financial accounting course and has asked you for assistance in preparing the financial information for the companys bank. Part A Prepare the journal entries for April (date and number, e.g., Apr. 1 JE1). If you feel that an entry is not required for the item on the given date, please clearly state No entry required and give a short rationale for your decision (use the date to identify the item but do not give it a journal entry number). Apr 1 The Company issued 200 shares to Jordan. These were common, voting shares. The firm received $18,000 for these shares. Apr 1 Suitable office space was found and it was available for immediate occupancy. The company paid six months rent in advance for a total of $12,000. Apr 1 The company negotiated a loan from a local bank for $50,000. The loan bears interest at a rate of 8 %. The interest is payable on the first day of each month. The full amount of the loan principal ($50,000) is due on June 1, 2025. It was deposited into the companys bank account on the same day. Apr 2 Special computers were needed to create the architectural drawings. JSA purchased a new computer on account for $5,040. The total invoice is due on May 10, at which time it will be paid. The computer is expected to last three years (36 months) at which time it will have a zero $ value. JSA felt that straight-line depreciation would be appropriate for this asset. Apr 4 The company decided that it needed to promote its services to potential clients. JSA hired AJL Printing to print the companys marketing brochures at a cost of $1,800. These were delivered on April 5 and the company paid for them upon receipt. All these brochures were immediately delivered to prospective clients. Apr 8 JSA went shopping for office supplies and paid $3,500 cash for the purchases. Apr 9 Anderson Construction hired JSA to prepare a building layout for Anderson. Apr 11 JSA purchased an existing trademark (from a firm whose owner was retiring and shutting down the business) because Jordan felt that name recognition was important for the firm. The trademark will be used in all the firms promotional material for the foreseeable future. Purchasing the trademark and its legal rights cost JSA $10,000. Apr 12 JSA sent the completed layout to its customer, Anderson Construction, and immediately received $5,500 cash as an etransfer. Apr 16 JSA was hired by Yates Homes to prepare a set of plans. JSA expects it will take a couple of weeks to research and complete the work. JSA will not invoice the client until the work is completed. Apr 17 The office was much busier than Jordan had expected, so JSA hired an Administrative Assistant to organize the office. The Admin Assistant agreed to a bi-weekly (every two weeks) wage of $2,000, which is paid at the end of every second Friday with the first paycheque due on Friday, April 19. (The firms work week is Monday to Friday and the Friday paycheques included the Friday payday). Jordan planned to prorate the first paycheque. The Assistant was expect to start work on Thursday, April 18. Apr 23 The work for Yates Homes was completed (earlier than expected) and the Admin Assistant sent out an invoice for $14,250 to the customer. Terms were n/30. Apr 24 JSA was hired by Klein Design to do a viability study for a new structure. JSA expects to earn about $35,000 in revenue. The project will probably take three month. Because of the length of time before completion, JSA asked for, and received, $8,000 up front from the client. JSA does not expect to start this project until May. Apr 30 In order to pay off Jordans personal credit card bill (a result of some enthusiastic spring shopping) and to celebrate the success of the first month, the Company declared, recorded and distributed a dividend of $3,500.

Part B Prepare any/all adjusting journal entries you feel are necessary as a result of the additional data below. Please date and number, e.g., Apr. 30 AE1 your entries. If you feel that an entry is not required for any of the items listed above, record No entry required, and give a short rationale for your decision (use the number from the event list below (e.g., #3) to identify the event but do not give it an adjusting journal entry number). If you feel other (additional) adjusting entries need to be made as a result of Aprils operations, please add them last and assign each a letter (e.g., Apr 30 AE-A, April 3 AE-B, etc.). The company plans to record adjusting entries at the end of each month. Additional data for April is as follows: 1. The firm planned to be open as much as possible in April. But due to a previous commitment, Jordan had to shut the firm down on April 29th & 30th. The Administrative Assistant would not be paid for those days (but didnt really mind because it gave the Assistant a 4-day weekend!). 2. Jordan had been using a personal credit card to buy gas during April for business travel. JSAs accountant indicated that this was an allowable business expense, so Jordan planned to write a reimbursement cheque for the $250 but just hadnt gotten around to it (this would happen sometime in May). 3. As it turned out, JSA had been able to do some of the viability study for Klein Design. Jordan estimated that $10,000 of the project had been completed and had delivered some work to the client by April 30. Jordan wasnt sure what to do about this, because the remaining work on the project (and client billing) wouldnt happen until May and June. 4. Supplies were counted on April 30 and there was $2,150 worth of supplies remaining. 5. The bank indicated that the 8% interest rate would be applied on the basis of the nearest full month for interest purposes (i.e., any month would be 1/12 of the year for interest purposes). The Company did not qualify for sales tax in their first year of operations, so there are no sales tax entries to worry about. As this firm would be considered a small business for income tax purposes, the firm faced an effective income tax rate of 12% (this is the combined federal and provincial rate). Typically, the entry for income tax is the last adjusting entry made after all the expenses and revenues have been recorded and the net income before income tax can be calculated.