Question
eBook Monthly Transactions, Adjustments, and Financial Statements Moonlight Bay Inn is incorporated on January 2, 2017, by its three owners, each of whom contributes $20,000
eBook
Monthly Transactions, Adjustments, and Financial Statements
Moonlight Bay Inn is incorporated on January 2, 2017, by its three owners, each of whom contributes $20,000 in cash in exchange for shares of stock in the business. In addition to the sale of stock, the following transactions are entered into during the month of January:
| January 2: | A Victorian inn is purchased for $50,000 in cash. An appraisal performed on this date indicates that the land is worth $15,000, and the remaining balance of the purchase price is attributable to the house. The owners estimate that the house will have an estimated useful life of 25 years and an estimated salvage value of $5,000. |
| January 3: | A two-year, 12%, $30,000 promissory note was signed at Second State Bank. Interest and principal will be repaid on the maturity date of January 3, 2019. |
| January 4: | New furniture for the inn is purchased at a cost of $15,000 in cash. The furniture has an estimated useful life of ten years and no salvage value. |
| January 5: | A 24-month property insurance policy is purchased for $6,000 in cash. |
| January 6: | An advertisement for the inn is placed in the local newspaper. Moonlight Bay pays $450 cash for the ad, which will run in the paper throughout January. |
| January 7: | Cleaning supplies are purchased on account for $950. The bill is payable within 30 days. |
| January 15: | Wages of $4,230 for the first half of the month are paid in cash. |
| January 16: | A guest mails the business $980 in cash as a deposit for a room to be rented for two weeks. The guest plans to stay at the inn during the last week of January and the first week of February. |
| January 31: | Cash receipts from rentals of rooms for the month amount to $8,300. |
| January 31: | Cash receipts from operation of the restaurant for the month amount to $6,600. |
| January 31: | Each stockholder is paid $200 in cash dividends. |
Assume a 360-day year. When required, do not round your intermediate calculations and round your final answers to the nearest whole dollar.
How does this entry affect the accounting equation? If a financial statement item is not affected, select "No Entry" and leave the amount box blank. If the effect on a financial statement item is negative, i.e, a decrease, be sure to enter the answer with a minus sign.
| Balance Sheet | Income Statement | |||||||||||||
| Stockholders' | Net | |||||||||||||
| Assets | = | Liabilities | + | Equity | Revenues | Expenses | = | Income | ||||||
| fill in the blank 92bfc0ffd067f8f_2 | fill in the blank 92bfc0ffd067f8f_4 | fill in the blank 92bfc0ffd067f8f_5 | fill in the blank 92bfc0ffd067f8f_7 | fill in the blank 92bfc0ffd067f8f_9 | fill in the blank 92bfc0ffd067f8f_10 | |||||||||
e. Recognition of the earned portion of the guest's deposit.
| Activity | |
| Accounts | |
| Statement(s) |
How does this entry affect the accounting equation? If a financial statement item is not affected, select "No Entry" and leave the amount box blank. If the effect on a financial statement item is negative, i.e, a decrease, be sure to enter the answer with a minus sign.
| Balance Sheet | Income Statement | |||||||||||||
| Stockholders' | Net | |||||||||||||
| Assets | = | Liabilities | + | Equity | Revenues | Expenses | = | Income | ||||||
| fill in the blank 36b927073f94f8f_2 | fill in the blank 36b927073f94f8f_4 | fill in the blank 36b927073f94f8f_5 | fill in the blank 36b927073f94f8f_7 | fill in the blank 36b927073f94f8f_9 | fill in the blank 36b927073f94f8f_10 | |||||||||
f. Wages earned during the second half of January amount to $5,120 and will be paid on February 3.
| Activity | |
| Accounts | |
| Statement(s) |
How does this entry affect the accounting equation? If a financial statement item is not affected, select "No Entry" and leave the amount box blank. If the effect on a financial statement item is negative, i.e, a decrease, be sure to enter the answer with a minus sign.
| Balance Sheet | Income Statement | |||||||||||||
| Stockholders' | Net | |||||||||||||
| Assets | = | Liabilities | + | Equity | Revenues | Expenses | = | Income | ||||||
| fill in the blank 313bbbfba046018_2 | fill in the blank 313bbbfba046018_4 | fill in the blank 313bbbfba046018_5 | fill in the blank 313bbbfba046018_7 | fill in the blank 313bbbfba046018_9 | fill in the blank 313bbbfba046018_10 | |||||||||
g. Cleaning supplies on hand on January 31 amount to $230.
| Activity | |
| Accounts | |
| Statement(s) |
How does this entry affect the accounting equation? If a financial statement item is not affected, select "No Entry" and leave the amount box blank. If the effect on a financial statement item is negative, i.e, a decrease, be sure to enter the answer with a minus sign.
| Balance Sheet | Income Statement | |||||||||||||
| Stockholders' | Net | |||||||||||||
| Assets | = | Liabilities | + | Equity | Revenues | Expenses | = | Income | ||||||
| fill in the blank 197e75f5efc805c_2 | fill in the blank 197e75f5efc805c_4 | fill in the blank 197e75f5efc805c_5 | fill in the blank 197e75f5efc805c_7 | fill in the blank 197e75f5efc805c_9 | fill in the blank 197e75f5efc805c_10 | |||||||||
h. A gas and electric bill that is received from the city amounts to $740 and is payable by February 5.
| Activity | |
| Accounts | |
| Statement(s) |
How does this entry affect the accounting equation? If a financial statement item is not affected, select "No Entry" and leave the amount box blank. If the effect on a financial statement item is negative, i.e, a decrease, be sure to enter the answer with a minus sign.
| Balance Sheet | Income Statement | |||||||||||||
| Stockholders' | Net | |||||||||||||
| Assets | = | Liabilities | + | Equity | Revenues | Expenses | = | Income | ||||||
| fill in the blank b3e11cfc6fa605f_2 | fill in the blank b3e11cfc6fa605f_4 | fill in the blank b3e11cfc6fa605f_5 | fill in the blank b3e11cfc6fa605f_7 | fill in the blank b3e11cfc6fa605f_9 | fill in the blank b3e11cfc6fa605f_10 | |||||||||
i. Income taxes are to be accrued at a rate of 30% of income before taxes.
| Activity | |
| Accounts | |
| Statement(s) |
How does this entry affect the accounting equation? If a financial statement item is not affected, select "No Entry" and leave the amount box blank. If the effect on a financial statement item is negative, i.e, a decrease, be sure to enter the answer with a minus sign.
| Balance Sheet | Income Statement | |||||||||||||
| Stockholders' | Net | |||||||||||||
| Assets | = | Liabilities | + | Equity | Revenues | Expenses | = | Income | ||||||
| fill in the blank 746a86fe9031fdf_2 | fill in the blank 746a86fe9031fdf_4 | fill in the blank 746a86fe9031fdf_5 | fill in the blank 746a86fe9031fdf_7 | fill in the blank 746a86fe9031fdf_9 | fill in the blank 746a86fe9031fdf_10 | |||||||||
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College Accounting Ch 1-12
Authors: Dansby
5th Edition
0763834955, 978-0763834951
