Comprehensive Problem Bug-Off Exterminators Bug-Off Exterminators provides pest control services and sells extermination products manufactured by other companies. Following is the company's unadjusted trial balance as of December 31, 2019, December 31, 2019 Unadjusted Cash Trial Balance $ 19,800 Accounts receivable 5,400 Allowance for doubtful accounts $ 856 Merchandise inventory 15,900 Truck 46,000 Accum. depreciation Trucks 0 Equipment 87,800 Accum. depreciation Equipment 23,400 Accounts payable 5,700 Estimated warranty liability 2,100 Unearned services revenue Interest payable 0 Long-term notes payable 29,000 Cormon stock 24,000 Retained earnings 67,500 Dividende 24,000 Extermination services revenue 88,000 Interest revenue 900 Sales (of merchandise) 105,826 Coat of goods sold 50, 500 Depreciation expense-Trucks Depreciation expense-Equipment Wages expenne 49,000 Interest expense 0 0 o o Prey 1 of 1 !!! Score answer > Check my - www Depreciation expense-Equipment Wages expense Interest expense Rent expense Bad debts expense Miscellaneous expense Repairs expense utilities expense Warranty expense Totals 0 49,000 0 23,000 0 1,282 15,000 9,600 $347.282 $347,282 The following information in a through happlies to the company at the end of the current year. . The bank reconciliation as of December 31, 2019, Includes the following facts. Cash balance per bank Cauh balance per books Outstanding checke Deposit in transit Interest earned (on bank account) Bank service charges (miscellaneous expense) 516,500 19,800 2,500 3,150 80 29 Reported on the bank statement is a canceled check that the company failed to record. (Information from the bank reconciliation allows you to determine the amount of this check, which is a payment on an account payable) b. An examination of customers' accounts shows that accounts totaling $693 should be written off as uncollectible. Using an aging of receivables, the company determines that the ending balance of the Allowance for Doubtful Accounts should be $770. - At le nurses and scart in ennen nn 110 e le han arrist with the train lima matting the b. An examination of customers' accounts shows that accounts totaling $693 should be written off as uncollectible. Using an aging of receivables, the company determines that the ending balance of the Allowance for Doubtful Accounts should be $770. C. A truck is purchased and placed in service on January 1, 2019. Its cost is being depreciated with the straight-line method using the following facts and estimates. ook Original cost Expected salvage value Useful lite (years) $39,000 $13,600 Pint eferences d. Two items of equipment (a sprayer and an injector) were purchased and put into service in early January 2017 They are being depreciated with the straight-line method using these facts and estimates sprayer Injector Original cost 030,200 $20,000 Expected salvage value $ 3,000 5 1,900 Useful life (years) . $ e. On September 1, 2019, the company is paid $19,500 cash in advance to provide monthly service for an apartment complex for one year. The company began providing the services in September. When the cash was received, the full amount was credited to the Extermination Services Revenue account. 1. The company offers a warranty for the services it sells. The expected cost of providing warranty service is 2.5% of the extermination services revenue of $75,000 for 2019. No warranty expense has been recorded for 2019. All costs of servicing warranties in 2019 were properly debited to the Estimated Warranty Liability account 9. The $22,000 long-term note is an 8%, five-year, interest-bearing note with interest payable annually on December 31. The note was signed with First National Bank on December 31, 2019 h. The ending Inventory of merchandise is counted and determined to have a cost of $15.900. Bug-Off uses a perpetual inventory Prey 1 of 1 ! Score answer > signed with First National Bank on December 31, 2019. h. The ending inventory of merchandise is counted and determined to have a cost of $15,900. Bug-Off uses a perpetual inventory system. Required: 1. Determine amounts for the following items: a. Correct (reconciled) ending balance of Cash; and the amount of the omitted check b. Adjustment needed to obtain the correct ending balance of the Allowance for Doubtful Accounts. c. Depreciation expense for the truck used during year 2019. d. Depreciation expense for the two items of equipment used during year 2019. e. The adjusted 2019 ending balances of the Extermination Services Revenue and Unearned Services Revenue accounts f. The adjusted 2019 ending balances of the accounts for Warranty Expense and Estimated Warranty Liability. 9. The adjusted 2019 ending balances of the accounts for interest Expense and Interest Payable. 2. Use the results of part 1 to complete the six-column table by first entering the appropriate adjustments for items a through gand then completing the adjusted trial balance columns. Hint:Item brequires two adjustments. 3. Prepare journal entries to record the adjustments entered on the six-column table. Assume Bug-Off's adjusted balance for Merchandise Inventory matches the year-end physical count 4a. Prepare a single-step Income statement for year 2019, 4b. Prepare the statement of retained earnings (cash dividends during 2019 were $24,000) for 2019. 4c. Prepare a classified balance sheet as at 2019. Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg 4C Req3 Reg 4 Reg 48 Proy 1 of 1 !!! Score answer > a. Correct (reconciled) ending balance of Cash; and the amount of the omitted check. b. Adjustment needed to obtain the correct ending balance of the Allowance for Doubtful Accounts. c. Depreciation expense for the truck used during year 2019. d. Depreciation expense for the two items of equipment used during year 2019. e. The adjusted 2019 ending balances of the Extermination Services Revenue and Unearned Services Revenue accounts. (Do not round your intermediate calculations.) f. The adjusted 2019 ending balances of the accounts for Warranty Expense and Estimated Warranty Liability g. The adjusted 2019 ending balances of the accounts for Interest Expense and Interest Payable Show less BOOK a rences Reconciled balanco Omitted check Necessary adjustment Depreciation expense b C d. Sprayer Injector Depreciation expense Unearned Services Revenue Services Revenue e. Ending balances after adjustment Warranty Expenso Estimated Warranty Liability C. Depreciation expense d. Sprayer Injector Depreciation expense Services Revenue Unearned Services Revenue Ending balances after adjustment Warranty Expense Estimated Warranty Liability Ending balances after adjustment Interest Expense Interest Payable Ending balances after adjustment
Comprehensive Problem Bug-Off Exterminators Bug-Off Exterminators provides pest control services and sells extermination products manufactured by other companies. Following is the company's unadjusted trial balance as of December 31, 2019, December 31, 2019 Unadjusted Cash Trial Balance $ 19,800 Accounts receivable 5,400 Allowance for doubtful accounts $ 856 Merchandise inventory 15,900 Truck 46,000 Accum. depreciation Trucks 0 Equipment 87,800 Accum. depreciation Equipment 23,400 Accounts payable 5,700 Estimated warranty liability 2,100 Unearned services revenue Interest payable 0 Long-term notes payable 29,000 Cormon stock 24,000 Retained earnings 67,500 Dividende 24,000 Extermination services revenue 88,000 Interest revenue 900 Sales (of merchandise) 105,826 Coat of goods sold 50, 500 Depreciation expense-Trucks Depreciation expense-Equipment Wages expenne 49,000 Interest expense 0 0 o o Prey 1 of 1 !!! Score answer > Check my - www Depreciation expense-Equipment Wages expense Interest expense Rent expense Bad debts expense Miscellaneous expense Repairs expense utilities expense Warranty expense Totals 0 49,000 0 23,000 0 1,282 15,000 9,600 $347.282 $347,282 The following information in a through happlies to the company at the end of the current year. . The bank reconciliation as of December 31, 2019, Includes the following facts. Cash balance per bank Cauh balance per books Outstanding checke Deposit in transit Interest earned (on bank account) Bank service charges (miscellaneous expense) 516,500 19,800 2,500 3,150 80 29 Reported on the bank statement is a canceled check that the company failed to record. (Information from the bank reconciliation allows you to determine the amount of this check, which is a payment on an account payable) b. An examination of customers' accounts shows that accounts totaling $693 should be written off as uncollectible. Using an aging of receivables, the company determines that the ending balance of the Allowance for Doubtful Accounts should be $770. - At le nurses and scart in ennen nn 110 e le han arrist with the train lima matting the b. An examination of customers' accounts shows that accounts totaling $693 should be written off as uncollectible. Using an aging of receivables, the company determines that the ending balance of the Allowance for Doubtful Accounts should be $770. C. A truck is purchased and placed in service on January 1, 2019. Its cost is being depreciated with the straight-line method using the following facts and estimates. ook Original cost Expected salvage value Useful lite (years) $39,000 $13,600 Pint eferences d. Two items of equipment (a sprayer and an injector) were purchased and put into service in early January 2017 They are being depreciated with the straight-line method using these facts and estimates sprayer Injector Original cost 030,200 $20,000 Expected salvage value $ 3,000 5 1,900 Useful life (years) . $ e. On September 1, 2019, the company is paid $19,500 cash in advance to provide monthly service for an apartment complex for one year. The company began providing the services in September. When the cash was received, the full amount was credited to the Extermination Services Revenue account. 1. The company offers a warranty for the services it sells. The expected cost of providing warranty service is 2.5% of the extermination services revenue of $75,000 for 2019. No warranty expense has been recorded for 2019. All costs of servicing warranties in 2019 were properly debited to the Estimated Warranty Liability account 9. The $22,000 long-term note is an 8%, five-year, interest-bearing note with interest payable annually on December 31. The note was signed with First National Bank on December 31, 2019 h. The ending Inventory of merchandise is counted and determined to have a cost of $15.900. Bug-Off uses a perpetual inventory Prey 1 of 1 ! Score answer > signed with First National Bank on December 31, 2019. h. The ending inventory of merchandise is counted and determined to have a cost of $15,900. Bug-Off uses a perpetual inventory system. Required: 1. Determine amounts for the following items: a. Correct (reconciled) ending balance of Cash; and the amount of the omitted check b. Adjustment needed to obtain the correct ending balance of the Allowance for Doubtful Accounts. c. Depreciation expense for the truck used during year 2019. d. Depreciation expense for the two items of equipment used during year 2019. e. The adjusted 2019 ending balances of the Extermination Services Revenue and Unearned Services Revenue accounts f. The adjusted 2019 ending balances of the accounts for Warranty Expense and Estimated Warranty Liability. 9. The adjusted 2019 ending balances of the accounts for interest Expense and Interest Payable. 2. Use the results of part 1 to complete the six-column table by first entering the appropriate adjustments for items a through gand then completing the adjusted trial balance columns. Hint:Item brequires two adjustments. 3. Prepare journal entries to record the adjustments entered on the six-column table. Assume Bug-Off's adjusted balance for Merchandise Inventory matches the year-end physical count 4a. Prepare a single-step Income statement for year 2019, 4b. Prepare the statement of retained earnings (cash dividends during 2019 were $24,000) for 2019. 4c. Prepare a classified balance sheet as at 2019. Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg 4C Req3 Reg 4 Reg 48 Proy 1 of 1 !!! Score answer > a. Correct (reconciled) ending balance of Cash; and the amount of the omitted check. b. Adjustment needed to obtain the correct ending balance of the Allowance for Doubtful Accounts. c. Depreciation expense for the truck used during year 2019. d. Depreciation expense for the two items of equipment used during year 2019. e. The adjusted 2019 ending balances of the Extermination Services Revenue and Unearned Services Revenue accounts. (Do not round your intermediate calculations.) f. The adjusted 2019 ending balances of the accounts for Warranty Expense and Estimated Warranty Liability g. The adjusted 2019 ending balances of the accounts for Interest Expense and Interest Payable Show less BOOK a rences Reconciled balanco Omitted check Necessary adjustment Depreciation expense b C d. Sprayer Injector Depreciation expense Unearned Services Revenue Services Revenue e. Ending balances after adjustment Warranty Expenso Estimated Warranty Liability C. Depreciation expense d. Sprayer Injector Depreciation expense Services Revenue Unearned Services Revenue Ending balances after adjustment Warranty Expense Estimated Warranty Liability Ending balances after adjustment Interest Expense Interest Payable Ending balances after adjustment
