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During the month of May 20--, The General's Favorite Fishing Hole engaged in the following transactions. May-01 In order to provide snacks for guests on
During the month of May 20--, The General's Favorite Fishing Hole engaged in the following transactions.
May-01 | In order to provide snacks for guests on a 24-hour basis, Night signed a contract with Snack Attack. Snack Attack will install vending machines with food and drinks and pay a 10% commission on all sales. Estimated payments are made at the beginning of each month. Night received a check for $200, the estimated commission on sales for May. |
2 | Night purchased a surround sound system and big screen TV with a digital satellite system for the guest lounge. The surround sound system cost $3,600 and has an estimated useful life of five years and no salvage value. The TV cost $8,000, has an estimated useful life of eight years, and has a salvage value of $800. Night paid cash for both items. |
2 | Paid for Mays programming on the new digital satellite system, $125. |
3 | Nights office manager returned $100 worth of office supplies to Gordon Office Supply. Night received a $100 reduction on the account. |
3 | Deposited registration fees, $52,700. |
3 | Paid rent for lodge and campgrounds for the month of May, $40,000. |
3 | In preparation for the purchase of a nearby campground, Night invested an additional $600,000. |
4 | Paid Gordon Office Supply on account, $400. |
4 | Purchased the assets of a competing business and paid cash for the following: land, $100,000; lodge, $530,000; and fishing boats, $9,000. The lodge has a remaining useful life of 50 years and a $50,000 salvage value. The boats have remaining lives of five years and no salvage value. |
5 | Paid Mays insurance premium for the new camp, $1,000. (See above transaction.) |
5 | Purchased food supplies from Acme Super Market on account, $22,950. |
5 | Purchased office supplies from Gordon Office Supplies on account, $1,200. |
7 | Night paid $40 each for one-year subscriptions to Fishing Illustrated, Fishing Unlimited, and Fish Master. The magazines are published monthly. |
10 | Deposited registration fees, $62,750. |
13 | Paid wages to fishing guides, $30,000. (Dont forget wages payable.) |
14 | A guest became ill and was unable to stay for the entire week. A refund was issued in the amount of $1,000. |
17 | Deposited registration fees, $63,000. |
19 | Purchased food supplies from Acme Super Market on account, $18,400. |
21 | Deposited registration fees, $63,400. |
23 | Paid $2,500 for Mays advertising spots on National Sports Talk Radio. |
25 | Paid repair fee for damaged boat, $850. |
27 | Paid wages to fishing guides, $30,000. |
28 | Paid $1,800 for Mays advertising spots on billboards. |
29 | Purchased food supplies from Acme Super Market on account, $14,325. |
30 | Paid utilities bill, $3,300. |
30 | Paid phone bill, $1,800. |
30 | Paid Acme Super Market on account, $47,350. |
31 | Bob Night withdrew cash for personal use, $7,500. |
Adjustment information at the end of May is provided below.
(a) | Total vending machine sales were $2,300 for the month of May. A 10% commission is earned on these sales. |
(b) | Straight-line depreciation is used for the 10 boats purchased on April 2 for $60,000. The useful life for these assets is five years and there is no salvage value. A full months depreciation was taken in April on these boats. Straight-line depreciation is also used for the two boats purchased in May. Make one adjusting entry for all depreciation on the boats. |
(c) | Straight-line depreciation is used to depreciate the surround sound system. |
(d) | Straight-line depreciation is used to depreciate the big screen TV. |
(e) | Straight-line depreciation is used for the building purchased in May. |
(f) | On April 2, Night paid $9,000 for insurance during the six-month camping season. Mays portion of this premium was used up during this month. |
(g) | Night received his May issues of Fishing Illustrated, Fishing Unlimited, and Fish Master. |
(h) | Office supplies remaining on hand, $150. |
(i) | Food supplies remaining on hand, $5,925. |
(j) | Wages earned, but not yet paid, at the end of May, $6,000. |
Required:
1. | Enter the transactions in a general journal. Enter transactions from May 14 on page 7, May 528 on page 8, and the remaining entries on page 9. |
2. | Post the entries to the general ledger. |
3. | Prepare a trial balance on a work sheet. |
4. | Complete the work sheet. |
5. | Journalize the adjusting entries |
6. | Post the adjusting entries to the general ledger. |
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