Question
Beginning balances of UPM Companys accounts as of January 1, 2016 as given below: Beg Balance Account Title Debit Credit Cash 142300 Accounts Receivable 48500
Beginning balances of UPM Companys accounts as of January 1, 2016 as given below:
| Beg Balance | |
Account Title | Debit | Credit |
Cash | 142300 |
|
Accounts Receivable | 48500 |
|
Supplies | 18000 |
|
Prepaid Insurance | 0 |
|
Inventory | 6000 |
|
Equipment | 30000 |
|
Accumulated Depreciation-Equipment |
| 16000 |
Accounts Payable |
| 35000 |
Salary Payable |
| 27,000 |
Unearned Sales Revenue |
| 15000 |
Capital |
| 151800 |
Withdrawals | 0 |
|
Sales Revenue |
|
|
Sales Returns& Allowances |
|
|
Sales Discounts |
|
|
Cost of Goods Sold |
|
|
Insurance Expense |
|
|
Depreciation Expense-Equipment |
|
|
Supplies Expense |
|
|
Salary Expense |
|
|
Total | 244800 | 244800 |
During January 2016, UPM Company completed the following transactions:
- Jan 2: Purchased 300 units of inventory for 13,500$ from Happy Company, on terms, 3/20, n/60.
- Jan 4: Purchased 150 units of inventory from Maids Company on account with terms 2/5, n/30. Total invoice includes $6,800 plus $250 freight charges.
- Jan 5: Paid total salary of the December 2015, 27,000$.
- Jan 10: Paid to Maids Company.
- Jan 11: Prepaid one-year insurance, $3,600.
- Jan 12: Sold 500 units of goods to Shine Company for $50,000 ($100 each) on account with terms 5/10, n/30.
- Jan 14: Received 50 units of goods back from Shine Company (Returned goods are from $47 of cost each).
- Jan 15: Received payment from Shine Company, settling the amount due in full.
- Jan 20: Sold 70 units on account, $7,000 ($100 each) for cash to Bridget Company, n/30.
- Jan 26: Owner withdrew cash of 5,000$
- Jan 27: Purchased supplies for cash of $3,000.
On January 31, 2016 UPM completed following adjusting entries:
- Expiration of prepaid insurance for one month
- Depreciation of equipment for the month, $2,500
- Supplies on hand, $6,000
- Unearned sales revenue earned is, $12,000.
- Accrued salary of the January 2016 is 27,000$ which will be paid on the 5th of the next month.
Requirements:
- Journalize and post the January transactions. (Open T-accounts for each of the accounts given in trial balance, do not forget to write beginning balances) (2 points each)
- Prepare FIFO schedule to calculate the Cost of Goods Sold (COGS) on the Jan 12th, and 20th. (Beginning inventory as of January 1 include 150 units $40 each which totals $6,000 as given) (17points)
- Prepare unadjusted trial balance as of January 31, 2016. (10 points)
- Journalize and post the adjusting entries. (3 points each)
- Prepare adjusted trial balance as of January 31, 2016. (10 points)
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