examples

Flounder Corp.'s unadjusted trial balance at December 1,2025 , is presented below. AccumulatedDepreciation-BuildingsAccumulatedDepreciation-EquipmentAccountsPayableSalariesandWagesPayableNotesPayable(dueApril30,2026)IncomeTaxesPayableInterestPayableNotesPayable(duein2031)CommonStockRetainedEarningsDividendsSalesRevenueInterestRevenue62,00029,76033,852013,6400043,40062,00078,76414,8801,116,0000 Gain on Disposal of Plant Assets 0 Bad Debt Expense Cost of Goods Sold Depreciation Expense Income Tax Expense Insurance Expense Interest Expense Other Operating Expenses Amortization Expense Salaries and Wages Expense Total 0 781,200 0 0 0 0 76,632 0 \( \frac{136,400}{\hline} \) $1,440,036 The following transactions occurred during December. Dec. 2 Purchased equipment for $19,840, plus sales taxes of $992 (paid in cash). 2 Flounder sold for $4,340 equipment which originally cost $6,200. Accumulated depreciation on this equipment at January 1, 2025, was $2,232; 2025 depreciation prior to the sale of equipment was $1,023. 15 Flounder sold for $6,200 on account inventory that cost $4,340. (Flounder records sales under a perpetual inventory system.) 23 Salaries and wages of $8,184 were paid. 1. Flounder estimates that uncollectible accounts receivable at year-end are $4,960. 2. The note receivable is a one-year, 8% note dated April 1,2025 . No interest has been recorded. 3. The balance in prepaid insurance represents payment of a \$4,464, 6-month premium on September 1, 2025 . 4. The building is being depreciated using the straight-line method over 30 years. The salvage value is $37,200. 5. The equipment owned prior to this year is being depreciated using the straight-line method over 5 years. The salvage value is 10% of cost. 6. The equipment purchased on December 2, 2025, is being depreciated using the straight-line method over 5 years, with a salvage value of $2,232. 7. The patent was acquired on January 1, 2025, and has a useful life of 9 years from that date. 8. Unpaid salaries at December 31,2025 , total $2,728. 9. Both the short-term and long-term notes payable are dated January 1, 2025, and carry a 10% interest rate. All interest is payable in the next 12 months. 10 Income tax expense was $18,600. It was unpaid at December 31 . Prepare journal entries for the transactions listed above and adjusting entries. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Record journal entries in the order presented in the problem.) (To record depreciation expense on equipment.) (To record depreciation expense on equipment.) (To record sale of equipment.) (To record sales revenue.) (To record cost of goods sold.) 1. 2. 3. 4. 5. 6. 7. Prepare journal entries for the transactions listed above and adjusting entries. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the