Attached below are templates for the information. Assistance would be greatly appreciated.
B&L Landscapes, Inc. Mini Practice Part 1 Bill Graham started his career mowing lawns for neighbors while he was in junior high school. Bill worked summers for the local golf course while he was in high school and after he graduated, he started his own lawn care business, Bill's Lawn Care. In addition to lawn care, he also sells two types of fertilizer. Bill is ready to expand his business and wants to add sprinkler systems to his product offering. Larry Miller has an established sprinkler system business and they have agreed to merge their two businesses together. They considered the partnership form of business but have decided to incorporate. You are taking an accounting class at the local community college and have been helping Bill keep the accounting records for his business. He has asked you to stay on and establish and maintain the accounting records for the new company, B&L Landscapes, Inc. Bill and Larry have hired an attorney and filed the incorporation paperwork with the state of Colorado. In the articles of incorporation, they are authorized to issue 150,000 shares of $1 par value common stock and 5,000 shares of $100 par value, 5%, non-cumulative, non-participating preferred stock. The new corporation will be created on July 1, 2016. The fair value of the assets and liabilities of both companies are as follows: Account Bill's Lawn Care Cash Accounts Receivable Prepaid Insurance Inventory Land Building Equipment Accounts Payable Notes Payable (due 4/30/2026) Cash Accounts Receivable Prepaid Insurance Inventory Equipment Accounts Payable $11,500 500 500 1,000 9,000 35,000 7,500 5,000 45,000 Larry's Sprinkler Systems $11,000 3,000 100 1,000 10,000 5,000 Bill and Larry have decided that they will each receive 1 share of common stock for every dollar of working capital (assets less liabilities) they contribute to the new company. You may assume that all the assets and liabilities listed above will be part of the new company. Additionally, they issue stock as follows: Jul Jul 1 1 Issued 50 shares of preferred stock for $100 per share cash to Bill's father. Issued 20 shares of preferred stock for $100 per share cash to Larry's mother. Instructions: 1. Using the chart of accounts provided below, and the Excel template provided with this assignment, prepare journal entries, in good form, to record the creation of B&L Landscapes, Inc. and the issuance of stock. Use July 1 for the creation journal entries. Start with Page 1 of the General Journal. Explanations are optional. 2. Prepare a classified balance sheet for B&L Landscapes, Inc. for July 1, 2016. 3. During the first year of operations, B&L Inc. earned net income of $32,500. They also declared a $2,000 dividend on June 10, 2017 payable on June 30, 2017. Prepare an allocation of the dividend to each class of stock. 4. Record the journal entries for the dividend declaration and payment on Page 2 of the General Journal. Explanations are optional. 5. Prepare the Stockholders' Equity section of the balance sheet for June 30, 2017. Classification ASSETS LIABILITIES STOCKHOLDERS' EQUITY REVENUES COST OF GOODS SOLD EXPENSES B&L Landscapes, Incorporated Chart of Accounts Account Account Name Number 101 Cash 110 Accounts Receivable 112 Allowance for Doubtful Accounts 115 Notes Receivable 116 Interest Receivable 120 Supplies 130 Prepaid Insurance 140 Inventory 150 Land 152 Building 153 Equipment 155 Accumulated Depreciation - Building 156 Accumulated Depreciation - Equipment 201 Accounts Payable 220 Notes Payable 225 Interest Payable 280 Dividend's Payable 301 Common Stock 310 Preferred Stock 330 Cash Dividends 350 Retained Earnings 401 Lawn Service Revenue 410 Sales Revenue 415 Sales Returns and Allowances 420 Interest Income 501 Purchases 505 Purchase Returns and Allowances 620 Supplies Expense 630 Fuel Expense 640 Repair and Maintenance Expense 650 Advertising Expense 65 Organization Expense 660 Insurance Expense 670 Depreciation Expense 680 Interest Expense 690 Bad Debt Expense IE '44 bu. mm 1 MMLUOUI 0mm] mu.. This page should Show the calculations of how the dividend; will besplit between prefermd a nd common Slockhold er; mmcn suns-running
