D E A Adomain Balance Sheet As of December 31, Year 0 4 Assets 5 Cash 6 Marketable Securities $80,000 6,700 7 Accounts Receivable 20,000 8 Inventory 25,000 9 PP&E (net) 10 Intangible Assets 34,700 10,500 11 Other Long-Term Assets 15,000 $191,900 12 Total Assets 13 14 Liabilities & Equity 15 Accounts Payable $45,000 16 Notes Payable" 28,500 17 Unearned Revenue 50,000 18 Income Tax Payable 4,300 19 Common Stock 45,000 20 Retained Earnings 19,100 21 Total Liabilities & Equity $191,900 22 23 "Assume these notes represent non-interest-bearing loans from owners, due in 5 years. Year 1 Transactions for Adomain 2. Transaction Date Event January 1 Purchased a patent for $32,000 in cash March 15 Paid $18,500 in cash for long-term assets 2. Prepaid $36,000 for rent for the next 12 months and recorded the transaction as an asset. Issued 1000 common shares to investors for $60,000 Sold inventory on account for $120,000 (a). The cost of the inventory was $16,000 (b). Also, paid a sales commission on this sale of $10,000 (c). Paid $13,400 in cash for costs related to research and development of new products. Received $24,000 in cash in advance for services. The services will be provided over the course of 6 months beginning on Dec 1 of this year. Received the cash to settle $65,000 of the receivables recorded on April 1. Paid last year's income tax liability. Purchased inventory for $15,000. Paid $3,000 in cash and recorded an Accounts Payable for the remaining balance. Received $20,000 in cash relating to the Accounts Receivable in transaction 5. Purchased supplies for $7.000 in cash. The accountant accidentally recorded the supplies in the Accounts Receivable account. April 1 April 1 April 1 April S May 1 May 1 June 30 July 31 July 31 Sept 30 October 1 The accountant recorded an adjustment to correct the entry made in 12a (so that the accounts will reflect what should have been recorded ). Joctober 1 Purchased marketable securities for $6,000 in cash. October 1 Borrowed $20,000 from a local bank and signed a 3-year note payable promising to pay 10% interest per year (interest is due and recorded on Dec 31). Dec 1 Dec 31 Dec 31 Dec 31 Dec 31 Dec 31 10 11 12 10 11 13 14 12a 12b 15 16 13 17 14 15 18 Employee salaries earned amounted to $34,000. The company paid $4,000 on Dec 1 and the remainder will be Income Tax for Year 1 is $5,500. $3,500 is paid this year and the remainder will be paid on June 30 of Year 2. paid on Jan 1, Year 2. 19 16 20 17 Record the appropriate adjusting entry related to transaction 3. Record the appropriate adjusting entry related to transaction 7. $2000 of supplies are still on hand on Dec 31. Record the appropriate adjusting entry to reflect the supplies used during the year. (Refer to transaction 12 Record the appropriate adjusting entry related to the note payable described in transaction 14 (assuming interest will be paid in Year 2). 21 18 22 19 23 20 General Journal Please do NOT ADD or DELETE rows! If you need multiple entries for one transaction, skip a row between entries. Transaction # Account Title-Description Date Debit Credit 10 3. 11 12 13 14 15 16 Sa 17 18 19 Sb 20 21 22 Sc 23 6. 26 27 28 29 30 31 32 33 10 38 11 1 42 43 44 12a 45 46 47 12b 48 50 13 51 52 53 14 54 55 56 15 57 58 59 60 16 61 62 63 64 ADJUSTING ENTRIES 65 17 66 67 68 18 69 70 71 19 72 73 74 20 75 76 CLOSING ENTRIES 77 78 79 80 81 82 83 86 87 88 89 90 91 92 FORMULAS MUST BE USED. DO NOT HARD CODE ANY NUMBER. PPAE ( Interest Payable Saluries Expee Cash BB BB BB EB EB EB Marketing Exene Intangibk Asch Common Stock 10 11 12 BB BB BB 13 14 15 16 EB EB EB EB Marketable Securitiks BB 17 18 19 Service Revenue Other LT Assets Retained Earnings BB 20 21 22 23 EB EB EB Accounts Receiable 24 25 26 27 Saks Revenue Rent Expense Accounts Payable BB 28 29 30 EB EB EB EB 31 32 33 34 In Notes Payable Supplies Expens Cost of Goods Sold BB 35 36 37 38 EB EB EB EB Prepaid Rent Saks Commissions Uneamed Revene Interest Expense 39 40 BB BB BB 41 42 43 44 EB JEB EB EB 45 46 47 Supelies Income Tax Payable RAD Expense Jnco Ex BB BB BB 49 50 51 EB EB EB EB 53 54 55 56 Salaries Payable 57 58 EB 59 60 61 Adomain Income Statement For the year ended December 31, Year ! Revenues Cells highlighted in blue must include formulas and may not be hard coded. 6. Expenses 8. 10 11 12 13 Income from Operations 14 15 16 Income before Taxes 17 18 Net Income 19 20 Adomain Balance Sheet As of December 31, Year I Assets Cells highlighted in blue must include formulas and may not be hard coded. 6. 8. 10 11 12 13 14 Total Assets 15 16 Liabilities & Equity 17 18 19 20 21 22 23 24 25 Total Liabilities & Equity 26 Post-Closing Trial Balance DR CR 9. 10 11 12 13 14 15 16 17 18 19 20 21 Total 22 23 24 C. D E A Adomain Balance Sheet As of December 31, Year 0 4 Assets 5 Cash 6 Marketable Securities $80,000 6,700 7 Accounts Receivable 20,000 8 Inventory 25,000 9 PP&E (net) 10 Intangible Assets 34,700 10,500 11 Other Long-Term Assets 15,000 $191,900 12 Total Assets 13 14 Liabilities & Equity 15 Accounts Payable $45,000 16 Notes Payable" 28,500 17 Unearned Revenue 50,000 18 Income Tax Payable 4,300 19 Common Stock 45,000 20 Retained Earnings 19,100 21 Total Liabilities & Equity $191,900 22 23 "Assume these notes represent non-interest-bearing loans from owners, due in 5 years. Year 1 Transactions for Adomain 2. Transaction Date Event January 1 Purchased a patent for $32,000 in cash March 15 Paid $18,500 in cash for long-term assets 2. Prepaid $36,000 for rent for the next 12 months and recorded the transaction as an asset. Issued 1000 common shares to investors for $60,000 Sold inventory on account for $120,000 (a). The cost of the inventory was $16,000 (b). Also, paid a sales commission on this sale of $10,000 (c). Paid $13,400 in cash for costs related to research and development of new products. Received $24,000 in cash in advance for services. The services will be provided over the course of 6 months beginning on Dec 1 of this year. Received the cash to settle $65,000 of the receivables recorded on April 1. Paid last year's income tax liability. Purchased inventory for $15,000. Paid $3,000 in cash and recorded an Accounts Payable for the remaining balance. Received $20,000 in cash relating to the Accounts Receivable in transaction 5. Purchased supplies for $7.000 in cash. The accountant accidentally recorded the supplies in the Accounts Receivable account. April 1 April 1 April 1 April S May 1 May 1 June 30 July 31 July 31 Sept 30 October 1 The accountant recorded an adjustment to correct the entry made in 12a (so that the accounts will reflect what should have been recorded ). Joctober 1 Purchased marketable securities for $6,000 in cash. October 1 Borrowed $20,000 from a local bank and signed a 3-year note payable promising to pay 10% interest per year (interest is due and recorded on Dec 31). Dec 1 Dec 31 Dec 31 Dec 31 Dec 31 Dec 31 10 11 12 10 11 13 14 12a 12b 15 16 13 17 14 15 18 Employee salaries earned amounted to $34,000. The company paid $4,000 on Dec 1 and the remainder will be Income Tax for Year 1 is $5,500. $3,500 is paid this year and the remainder will be paid on June 30 of Year 2. paid on Jan 1, Year 2. 19 16 20 17 Record the appropriate adjusting entry related to transaction 3. Record the appropriate adjusting entry related to transaction 7. $2000 of supplies are still on hand on Dec 31. Record the appropriate adjusting entry to reflect the supplies used during the year. (Refer to transaction 12 Record the appropriate adjusting entry related to the note payable described in transaction 14 (assuming interest will be paid in Year 2). 21 18 22 19 23 20 General Journal Please do NOT ADD or DELETE rows! If you need multiple entries for one transaction, skip a row between entries. Transaction # Account Title-Description Date Debit Credit 10 3. 11 12 13 14 15 16 Sa 17 18 19 Sb 20 21 22 Sc 23 6. 26 27 28 29 30 31 32 33 10 38 11 1 42 43 44 12a 45 46 47 12b 48 50 13 51 52 53 14 54 55 56 15 57 58 59 60 16 61 62 63 64 ADJUSTING ENTRIES 65 17 66 67 68 18 69 70 71 19 72 73 74 20 75 76 CLOSING ENTRIES 77 78 79 80 81 82 83 86 87 88 89 90 91 92 FORMULAS MUST BE USED. DO NOT HARD CODE ANY NUMBER. PPAE ( Interest Payable Saluries Expee Cash BB BB BB EB EB EB Marketing Exene Intangibk Asch Common Stock 10 11 12 BB BB BB 13 14 15 16 EB EB EB EB Marketable Securitiks BB 17 18 19 Service Revenue Other LT Assets Retained Earnings BB 20 21 22 23 EB EB EB Accounts Receiable 24 25 26 27 Saks Revenue Rent Expense Accounts Payable BB 28 29 30 EB EB EB EB 31 32 33 34 In Notes Payable Supplies Expens Cost of Goods Sold BB 35 36 37 38 EB EB EB EB Prepaid Rent Saks Commissions Uneamed Revene Interest Expense 39 40 BB BB BB 41 42 43 44 EB JEB EB EB 45 46 47 Supelies Income Tax Payable RAD Expense Jnco Ex BB BB BB 49 50 51 EB EB EB EB 53 54 55 56 Salaries Payable 57 58 EB 59 60 61 Adomain Income Statement For the year ended December 31, Year ! Revenues Cells highlighted in blue must include formulas and may not be hard coded. 6. Expenses 8. 10 11 12 13 Income from Operations 14 15 16 Income before Taxes 17 18 Net Income 19 20 Adomain Balance Sheet As of December 31, Year I Assets Cells highlighted in blue must include formulas and may not be hard coded. 6. 8. 10 11 12 13 14 Total Assets 15 16 Liabilities & Equity 17 18 19 20 21 22 23 24 25 Total Liabilities & Equity 26 Post-Closing Trial Balance DR CR 9. 10 11 12 13 14 15 16 17 18 19 20 21 Total 22 23 24 C