Question
Below is your chart of accounts: 101 Cash 102 Inventory 103 Prepaid Supplies 104 Accounts Receivable 105 Property, Plant & Equipment 201 Accounts Payable 202
Below is your chart of accounts:
101 | Cash |
102 | Inventory |
103 | Prepaid Supplies |
104 | Accounts Receivable |
105 | Property, Plant & Equipment |
201 | Accounts Payable |
202 | Service Liability |
203 | Long-term Payables |
301 | Capital Stock |
302 | APIC (Additional Paid-In Capital) |
303 | Retained Earnings |
401 | Product Revenue |
402 | Service Revenue |
501 | COGS (Cost of Goods Sold) |
502 | Payroll Expense |
503 | Maintenance Expense |
504 | Supplies Expense |
On 2/1/2018, the beginning balances for SCUBA were:
Beginning Balances | |||
101 | Cash | $10,000 | |
102 | Inventory | $45,000 | |
103 | Prepaid Supplies | $5,000 | |
104 | Accounts Receivable | $40,000 | |
105 | Property, Plant & Equipment | $100,000 | |
201 | Accounts Payable | $40,000 | |
203 | Long-term Payables | $80,000 | |
301 | Capital Stock | $50,000 | |
302 | Additional Paid-in Capital | $10,000 | |
303 | Retained Earnings | $20,000 | |
$200,000 | $200,000 |
The following is a list of transactions that occurred during February:
2/1/2018 Purchased $15,000 worth of regulators, buoyancy compensator devices, dive computers, masks, fins, dry suits, tanks, gas analyzers, and a variety of other parts for the technical service department. For the sake of simplicity, all can be categorized as inventory. The dive shop pays cash for 1/3 of the total, and uses vendor credit for the remaining 2/3 - payment terms are 2% 10 net 30 days. (Management has decided to book all A/P at gross, not net).
2/15/2018 Narcosis SCUBA Emporium received $10,000, upfront, for service work to be performed in the future on Hennepin County Search & Rescues diving gear.
2/20/2018 The dive shop sells a dry suit for $2,800, a regulator/BCD combo for $1,200, and two dive computers for $1,000. Total product sales are $5,000 cash. Narcosis SCUBA Emporium marks up their cost 200%; so the cost of their inventory (COGS) was $2,500.
2/28/2018 Narcosis SCUBA Emporium pays their two part-time employees monthly. Total payroll costs for February is $3,000 (disregard payroll taxes and other related liabilities).
Prepare journal entries for the transactions shown above (Journal Ref will be created by the student. Use whatever system you want in order to track each individual journal entry)
Account: Cash Account: Accounts Payable Account No. 101 Balance Debit Credit Account No. 201 Balance Debit Credit Date Post. Ref Debit Credit Date Post. Ref Debit Credit BEG BEG Account: Inventory Account: Service Liability Account No. 102 Balance Debit Credit Account No. 202 Balance Debit Credit Date Post. Ref Debit Credit Date Post. Ref Debit Credit BEG BEG Account: Prepaid Supplies Date Post. Ref Debit Account No. 103 Balance Debit Credit Account: Long-term Payables Date Post. Ref Debit Credit Credit Account No. 203 Balance Debit Credit BEG BEG Account: Capital Stock Account: Accounts Receivable Date Post. Ref Debit Credit Account No. 104 Balance Debit Credit Account No. 301 Balance Debit Credit Date Post. Ref Debit Credit BEG BEG
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