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Can anyone help with the trial balance? It's due soon and my head is hurting. Comprehensive Problem 10-01 a-b, c1-c3 (Part Level Submission) Swifty Corporation's
Can anyone help with the trial balance? It's due soon and my head is hurting.
Comprehensive Problem 10-01 a-b, c1-c3 (Part Level Submission) Swifty Corporation's balance sheet at December 31, 2019, is presented below. Cash Inventory Prepaid insurance Equipment Swifty Corporation Balance Sheet December 31, 2019 $31,000 Accounts payable 30,000 Interest payable 7,320 Bonds payable 37,800 Common stock Retained earnings $106,120 $12,900 2,750 55,000 17,070 18,400 $106,120 During 2020, the following transactions occurred. 1. 2. 4. 5. 6. Swifty paid $2,750 interest on the bonds on January 1, 2020. Swifty purchased $241,700 of inventory on account. Swifty sold for $493,500 cash inventory which cost $262,000. Swifty also collected $34,545 sales taxes. Swifty paid $234,000 on accounts payable. Swifty paid $2,750 interest on the bonds on July 1, 2020. The prepaid insurance ($7,320) expired on July 31. On August 1, Swifty paid $12,000 for insurance coverage from August 1, 2020, through July 31, 2021. Swifty paid $24,200 sales taxes to the state. Paid other operating expenses, $90,200. Retired the bonds on December 31, 2020, by paying $52,000 plus $2,750 interest. Issued $95,000 of 8% bonds on December 31, 2020, at 104. The bonds pay interest every December 31. 8. 9. Doid 10. Adjustment data: 1. Recorded the insurance expired from item 7. The equipment was acquired on December 31, 2019, and will be depreciated on a straight-line basis over 5 years with a $3,180 salvage value. 3. The income tax rate is 30%. (Hint: Prepare the income statement up to income before taxes and multiply by 30% to compute the amount.) No. Account Titles and Explanation Debit Credit 1. Interest Payable 2750 Cash 2750 2. Inventory 244200 Accounts Payable 244200 3. Cash 528045 Sales Revenue 493500 34545 Sales Taxes Payable (To record sales revenue.) Cost of Goods Sold 262200 262200 Inventory (To record cost of goods sold.) 4. Accounts Payable 234000 Cash 234000 5. Interest Expense 2750 Cash 2750 Insurance Expense 7320 Prepaid Insurance 7320 7. Prepaid Insurance 12000 Cash 12000 8. Sales Taxes Payable 24200 Cash 24200 9. Other Operating Expenses 90200 Cash 90200 10. Interest Expense 2750 Cash 2750 (To record payment of bond interest) Bonds Payable 55000 Cash 52000 3000 Gain on Bond Redemption (To record redemption of bonds) 11. Cash 98800 Bonds Payable 95000 Premium on Bonds Payable 3800 Prepare journal entries for the adjusting entries. (Credit account titles are No. Account Titles and Explanation Debit Credit 1. Insurance Expense 5000 Prepaid Insurance 5000 Depreciation Expense 6924 No. Account Titles and Explanation Credit Debit 5000 1. Insurance Expense Prepaid Insurance 5000 2. Depreciation Expense 6924 Accumulated Depreciation-Equipr 6924 3. Income Tax Expense 32650 Income Tax Payable 32650 SHOW LIST OF ACCOUNTS (b) Prepare an adjusted trial balance at December 31, 2020. Swifty Corporation Trial Balance 12/31/2020 Debit 261395 Credit Cash Inventory Prepaid Insurance Equipment Accumulated Depreciation-Equipme Accounts Payable Sales Taxes Payable Income Tax Payable Sales Revenue Bonds Payable Premium on Bonds Payable Common Stock Retained Earnings Insurance Expense Cost of Goods Sold Interest Expense Other Operating Expenses Depreciation Expense Income Tax Expense Gain on Bond Redemption TotalsStep by Step Solution
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