Chapter 05 Comprehensive Problem The trial balance of Pacilio Security Services, Inc. as of January 1 Year 5, had the following normal balances: Cash Accounts receivable Supplies Prepaid rent Merchandise Inventory 9 $240) Land Accounts payable Salarien payable Common stock Retained earnings $62,060 20.500 150 2.000 2. 160 4,000 980 1.500 50,000 39,190 During Year 5, Pacilio Security Services experienced the following transactions: 1. Paid the salaries payable from Year 4. 2. On January 15, purchased 20 standard alarm systems for cash at a cost of $250 each, 3. On February 1, paid the accounts payable of $980, but not within the discount period. The company uses the gross method.) 4. On March 1, leased a business van. Paid $4,800 for one year's lease in advance. 5. Paid $7.200 on May 1 Yor one year's rent on the office in advance 6. Purchased with cash $500 of supplies to be used over the next several months by the business. 7. Purchased with cash another 25 alarm systems on August 1 for resale at a cost of $260 each 8. On September 5, purchased on account 30 standard alarm systems at a cost of $265 9. Installed 60 standard alarm systems for $33,000. Soles of $22,000 were on account, while $11,000 were cash sales. 10. Record the cost of goods sold related to the sale from Event 9 using the perpetual FIFO method. 11. Made a full refund to a dissatisfied customer who returned her larm system. The sale had been a cash sale for $550 with a cost of $260. Record the reversal of revenue. 12. Made a full refund to a dissatisfied customer who retumed her alarm system. The sale had been a cash sale for $550 with a cost of $260, Record the reversal of cost. 13. Pold Installers and other employees a total of $21.000 cash for salaries 14. Sold $45,000 of monitoring services during the year. The services are billed to the customers each month. 15. Sold an additional monitoring service for $1.200 for one years service. The customer paid the full amount of $1,200 on October 1. 16. Collected $74,000 of accounts receivable during the yeon 17. Paid an additional $6,000 to settle some of the accounts payable 18. Pald $3.500 of advertising expense during the year 19. Paid $2,320 of utilities expense for the year. 20. Pald a dividend of $15,000 to the shareholders. Adjustments 21. There was $200 of supplies on hand at the end of the year 22. Recognized the expired rent from the prior year, van and office building for the year 23. Recognized the revenue earned from transaction 15. 24. Accrued salaries at December 31, Year 5. Were $1,000. Requirem. General Journal General Ledger Trial Balance Income Changes in Statement SE Balance Sheet Statement of CF Analysis Indicate whether the transaction increases (+), decreases (-), or increases and decreases (+/-) for each element of the financial statements. Also, in the Cash Flow column, use the letters OA to designate operating activity, IA for investing activity, FA for financing activity. The first transaction is recorded as an example. Pacilio Security Services, Inc. Effect of Transactions on Financial Statements - Year 5 Balance Sheet Income Statement Net = Liabilities - S. Equity Revenue Expenses Income Statement of Cash Flows Transaction Assets 1. 2. 3. 4. 5. 6 7 8. 9. 10 11. 12 13 14 15. 16 17 18 19 20. 21 22 23 24