Date Description 171 BEGINNING BALANCES 1/8 Indiana pays off $30,000 of accounts payable 1/12 Indiana buys 300 units of inventory at a cost of $82/unit on credit, terms net/60. 1719 Indiana sells 320 units to Belloq, Inc. for $290 each on credit, terms 2/15, net 45. 1/21 Indiana pays the salaries payable balance from the beginning of the year. 1/31 Indiana collects the A/R owed by Lao Che from the beginning of the year in full (see instructions) 27 Indiana buys $3,000 of office supplies in cash. 2/15 Indiana pays off $30,000 of accounts payable. 2/18 Indiana collects the amount owed from Belloq, Inc from the 1/19 sale outside the discount period. 2/27) Indiana provides the services owed to a client. The client paid $50,000 in advance last year. 3/4 Indiana pays off the 1/12 purchase. 318 Indiana writes of the Temple of Doom A/R balance as uncollectible (see instructions) 3/14 Indiana collects the A/Rowed by Ark of the Covenant Inc. and Asp Co. (see instructions) 3/24 Indiana buys 350 units of inventory at a cost of $85/unit on credit, terms net/60. 471 Indiana sells 280 units to Elsa Schneider, Ltd. For $300 each on credit, terms 2/15, net/45. 4/8 Indiana grants Elsa Schneider, Ltd. an allowance of $300 for damaged goods. 4/12 Indiana collects the A/R owed by Elsa Schneider, Ltd. within the discount period. 4/25 Indiana pays for online advertising in the amount of $4,000. 5/1 Indiana buys a short-term investment for $20,000, 5/8 Indiana pays off the 3/24 purchase. 5/15 Indiana buys 275 units of inventory at a cost of $87/unit on credit terms net/60 5/27 Indiana pays the income taxes payable amount from the beginning of the year balance, B/3 Indiana pays the dividends payable amount from the beginning of the year balance. 6/27 Indiana buys 150 units of inventory at a cost of $90/unit on credit terms net/60 7/3 Indiana sells 220 units to Brody Curators Inc. for $305 each on credit terms 2/15, net:45. D23 ASSETS A B 1 Indiana Jones, Inc. 2 Summary of Account Balances 3 1/1/2005 (Beginning Balances) 4 Accounts Balances 5 Cash 110,000 6 Short-term Investments 7 Accounts Receivable 42,000 8 Allowance for Doubtful Accounts (7,000) 9 Interest Receivable 10 Office Supplies 1,000 11 Merchandise Inventory 22,000 2. Prepaid Insurance 25,000 13 Land 50,000 14 Building 400,000 15 Accumulated Depreciation -- Building (80,000) 16 Equipment 500,000 17 Accumulated Depreciation -- Equipment (100,000) 18 Intangible Asset -- Patent 40,000 19 Accounts Payable 60.000 20 Salaries Payable 10,000 21 Income Taxes Payable 15.000 22 Unearned Revenue 50.000 23 Dividends Payable 10.000 24 Interest Payable 15.000 25 Notes Payable 350.000 26 Common Stock 100.000 27 Additional Paid-in Capital 230,000 28 Retained Earnings 163.000 29 Sales Revenue LIABILITIES EQUIT D23 X C B 60,000 10,000 15,000 50,000 10,000 15,000 350,000 100,000 230,000 163,000 LIABILITIES EQUIT REVENUES 19 Accounts Payable 20 Salaries Payable 21 Income Taxes Payable 22 Unearned Revenue 23 Dividends Payable 24 Interest Payable 25 Notes Payable 26 Common Stock 27 Additional Paid-in Capital 28 Retained Earnings 29 Sales Revenue 30 Sales Discounts 31 Sales Allowances 32 Service Revenue 33 Interest Income 34 Cost of Goods Sold 35 Advertising Expense 36 Office Supplies Expense 37 Salaries Expense 38 Utilities Expense 39 Insurance Expense 40 Bad Debt Expense 41 Depreciation Expense 42 Amortization Expense 43 Miscellaneous Expense 44 Interest Expense 45 Income Tax Expense 46 Totals EXPENSES DONEC Note: The January 1, 2005 inventory balance consists of 275 units with a per unit cost of $80. 2. The Company uses the Allowance Method to account for bad debt. The Company determines its Allowance for Doubtful Accounts by estimating that 10% of the ending balance of Accounts Receivable will be tancollectible (Balance Sheet Approach). When specifically identified accounts are determined to be uncollectible, then the Company writes them off against the Allowance 3. Indiana Jones Inc depreciates Property. Planit, and Equipment using the straight line method. Buildings are depreciated over 40 years, Equipment is deprecinted over a 15-year life. The building has no salvage value and the equipment has a salvage value of $50,000. You will find the original cost of the buildings and equipment in the beginning balances spreadsheet 4. The Company owns a patent for laser excavation technology it developed two years past. The patent is amortized over its useful life. Amortization expense is $5,000 per year, and booked at the end of the year Other relevant information: 1 The A/R balance at January 1, 2005 consists of the following customer balances Lao Che Industries $15.000 (current) Temple of Doom Co $5,500 (90 days past due) Asp Co $10,000 (cument) Ark of the Covenant Inc. $11.500 (current) 2 The Company's common stock was issued with a $2.50 par value. 100,000 shares are authorized 40,000 shares are issued and outstanding 3 The prepaid insurance amount relates to five years' worth of insurance that began on Jawy 1, 2005 Chow conveniently 4 The Note Payable is a ten-year note that was taken out on December 31, 2001 The interest rate is 6.25% per annum. Interest payments are due Junuluy 5 for the previous year's interest (ie fiscal year 2005 interest is due January 5, 2006) Date Description 171 BEGINNING BALANCES 1/8 Indiana pays off $30,000 of accounts payable 1/12 Indiana buys 300 units of inventory at a cost of $82/unit on credit, terms net/60. 1719 Indiana sells 320 units to Belloq, Inc. for $290 each on credit, terms 2/15, net 45. 1/21 Indiana pays the salaries payable balance from the beginning of the year. 1/31 Indiana collects the A/R owed by Lao Che from the beginning of the year in full (see instructions) 27 Indiana buys $3,000 of office supplies in cash. 2/15 Indiana pays off $30,000 of accounts payable. 2/18 Indiana collects the amount owed from Belloq, Inc from the 1/19 sale outside the discount period. 2/27) Indiana provides the services owed to a client. The client paid $50,000 in advance last year. 3/4 Indiana pays off the 1/12 purchase. 318 Indiana writes of the Temple of Doom A/R balance as uncollectible (see instructions) 3/14 Indiana collects the A/Rowed by Ark of the Covenant Inc. and Asp Co. (see instructions) 3/24 Indiana buys 350 units of inventory at a cost of $85/unit on credit, terms net/60. 471 Indiana sells 280 units to Elsa Schneider, Ltd. For $300 each on credit, terms 2/15, net/45. 4/8 Indiana grants Elsa Schneider, Ltd. an allowance of $300 for damaged goods. 4/12 Indiana collects the A/R owed by Elsa Schneider, Ltd. within the discount period. 4/25 Indiana pays for online advertising in the amount of $4,000. 5/1 Indiana buys a short-term investment for $20,000, 5/8 Indiana pays off the 3/24 purchase. 5/15 Indiana buys 275 units of inventory at a cost of $87/unit on credit terms net/60 5/27 Indiana pays the income taxes payable amount from the beginning of the year balance, B/3 Indiana pays the dividends payable amount from the beginning of the year balance. 6/27 Indiana buys 150 units of inventory at a cost of $90/unit on credit terms net/60 7/3 Indiana sells 220 units to Brody Curators Inc. for $305 each on credit terms 2/15, net:45. D23 ASSETS A B 1 Indiana Jones, Inc. 2 Summary of Account Balances 3 1/1/2005 (Beginning Balances) 4 Accounts Balances 5 Cash 110,000 6 Short-term Investments 7 Accounts Receivable 42,000 8 Allowance for Doubtful Accounts (7,000) 9 Interest Receivable 10 Office Supplies 1,000 11 Merchandise Inventory 22,000 2. Prepaid Insurance 25,000 13 Land 50,000 14 Building 400,000 15 Accumulated Depreciation -- Building (80,000) 16 Equipment 500,000 17 Accumulated Depreciation -- Equipment (100,000) 18 Intangible Asset -- Patent 40,000 19 Accounts Payable 60.000 20 Salaries Payable 10,000 21 Income Taxes Payable 15.000 22 Unearned Revenue 50.000 23 Dividends Payable 10.000 24 Interest Payable 15.000 25 Notes Payable 350.000 26 Common Stock 100.000 27 Additional Paid-in Capital 230,000 28 Retained Earnings 163.000 29 Sales Revenue LIABILITIES EQUIT D23 X C B 60,000 10,000 15,000 50,000 10,000 15,000 350,000 100,000 230,000 163,000 LIABILITIES EQUIT REVENUES 19 Accounts Payable 20 Salaries Payable 21 Income Taxes Payable 22 Unearned Revenue 23 Dividends Payable 24 Interest Payable 25 Notes Payable 26 Common Stock 27 Additional Paid-in Capital 28 Retained Earnings 29 Sales Revenue 30 Sales Discounts 31 Sales Allowances 32 Service Revenue 33 Interest Income 34 Cost of Goods Sold 35 Advertising Expense 36 Office Supplies Expense 37 Salaries Expense 38 Utilities Expense 39 Insurance Expense 40 Bad Debt Expense 41 Depreciation Expense 42 Amortization Expense 43 Miscellaneous Expense 44 Interest Expense 45 Income Tax Expense 46 Totals EXPENSES DONEC Note: The January 1, 2005 inventory balance consists of 275 units with a per unit cost of $80. 2. The Company uses the Allowance Method to account for bad debt. The Company determines its Allowance for Doubtful Accounts by estimating that 10% of the ending balance of Accounts Receivable will be tancollectible (Balance Sheet Approach). When specifically identified accounts are determined to be uncollectible, then the Company writes them off against the Allowance 3. Indiana Jones Inc depreciates Property. Planit, and Equipment using the straight line method. Buildings are depreciated over 40 years, Equipment is deprecinted over a 15-year life. The building has no salvage value and the equipment has a salvage value of $50,000. You will find the original cost of the buildings and equipment in the beginning balances spreadsheet 4. The Company owns a patent for laser excavation technology it developed two years past. The patent is amortized over its useful life. Amortization expense is $5,000 per year, and booked at the end of the year Other relevant information: 1 The A/R balance at January 1, 2005 consists of the following customer balances Lao Che Industries $15.000 (current) Temple of Doom Co $5,500 (90 days past due) Asp Co $10,000 (cument) Ark of the Covenant Inc. $11.500 (current) 2 The Company's common stock was issued with a $2.50 par value. 100,000 shares are authorized 40,000 shares are issued and outstanding 3 The prepaid insurance amount relates to five years' worth of insurance that began on Jawy 1, 2005 Chow conveniently 4 The Note Payable is a ten-year note that was taken out on December 31, 2001 The interest rate is 6.25% per annum. Interest payments are due Junuluy 5 for the previous year's interest (ie fiscal year 2005 interest is due January 5, 2006)