follows: Selected transactions completed by Kornett Company during its first fiscal year ended December 31, 2016, were as Issued a check to establish a petty cash fund of $4,500. Jan 3 Feb. 26 Replenished the petty cash fund, based on the following summary of petty cash receipts: office supplies, S1,680; miscellaneous selling expense, $570; miscellaneous administrative expense, s880 14 Purchased $31,300 of merchandise on account, n/30. The perpetual inventory system is used to Apr account for inventory May13 Paid the invoice of April 14 17 Received cash from daily cash sales for $21,200. The amount indicated by the cash register wats $21,240 Received a 60-day, 8% note for $180,000 on the Ryanair account. 1 Received amount owed on June 2 note, plus interest at the maturity date. Assume a 360-day year Jun 2 Aug. 24 Received $7,600 on the Finley account and wrote off the remainder owed on a $9,000 accounts receivable balance. (The allowance method is used in accounting for uncollectible receivables.) 15 Reinstated the Finley account written off on August 24 and received $1,400 cash in full payment (Record as two entries.) Instructions Record the following on journal page 22 Purchased land by issuing a S670,000. 90-day note to Zahorik Co. which discounted it at 9%. Assume a 360-day year. sold office equipment in exchange for $135,000 cash plus receipt of a $100,000, 90-day, 9% note. The equipment had a cost of $320,000 and accumulated depreciation of $64,000 as of October 17 Journalized the monthly payroll for November, based on the following data Sep. 15 17 Oct Nv. 30 Salaries Sales salaries Office salaries $135,000 77,250 5212,250 Deductions Income tax withheld Social security tax withheld $39,266 12 735 structions 12,735 Social security tax withheld 3,184 Medicare tax withheld Unemployment Tax rates: 5 4% State unemployment Federal unemployment Amount subject to unemployment taxes State unemployment Federal unemployment 0.8% $5,000 5,000 Journalized the employer's payroll taxes on the payroll. 30 Dec 14 Journalized the payment of the September 15 note at maturity 31 The pension cost for the year was $190. 400, of which $139,700 was paid to the pension plan trustee structions Required: 1. Journa 2. Based on the foilowing data, ce the solected transactions, starting on page 21 of the journal- prepare a bank reconciliation for December 2016. Refer to the Labels and Amount Descriptions list for exact - Balance according to the bank statement at December 31, $283,000 Balance according to the ledger at December 31, $245,410 . Checks outstanding at December 31, $68,540 Doposit in transit, not recorded by bank, $29.500 + Bank debit memo for service charges, S750 . A check for $12, 700 in payment of an invoice was incorrecty the accounts as $12,000 reconciliation prepared in (2), journalize the entry or entries to be made by Kornett 3. Based on the bank r Administrative Expense account for bank service charges journalize the adjusting entries as of December 31, 2016 on page 23 of the journal Kornett Company uses the Miscellaneous 4 Based on the following selected data, entries as uncollectible accounts at December 31, $16,000, based on an aging of accounts receivable The balance of Allowance Doubtful Accounts at December 31 was $2.000 (debit) on December 31 indicated an inventory shrinkage of $3,300 . The physical inventory uctions Doubtut Accounts at December 31 was $2,000 (debit) - The physical inventory on December 31 indicated an inventory shrinkage of $3,300 Prepaid insurance expired during the year, $22,820 Office supplies used during the year, $3,920 Depreciation is computed as follows Residual Acquisition Useful Life Depreciation Method Used Double-declining-balance Straight-line Straight-line Asset Building Office Equip 246,000 26,000 January 3 Store Equip 112,000 12,000 July 1 Cost Value Date in Years So January 2 50 $900,00 10 A patent costing $48,000 when acquired on January 2 has a remaining jegal life of 10 years and is expected to have value for eight yea . The cost of mineral rights was $546,000 or the estimated deposit of 910,000 tons of ore, 50,000 tons were mined and sold during the y . Vacation pay expense for December, $10,300 . A product warranty was granted beginning December and covering a one-year penod The estimated cost is 4% of sales, which totals $1,900,000 in December tructions $1,900,000 in December - Interest was accrued on the note receivable received on October 17. Assume a 360 day year Refer to the Chart of Accounts for exact wording of account bties 5. Based on the following information and the post-closing trial balance that follows, prepare a balance sheet in report rorm at December 31, 2016 Be sure to complete the heading of the balance sheet Enter assets in the order in which they appear in the post-closing trial balance. Refer to information given in the problem and the Labels and Amount Descriptions list for exact wording of text entries There is no need to include (current portion)"or a due date with any account titles. The word Less" and colons will appear automatically Enter all amounts as positive numbers The merchandise inventory is stated at cost by the LIFO method . The product warranty payable is a current habaity Vacation pay payable Current liability $7,140 Long-term liability 3.360 The untunded pension liability is a long-term hability Notes payable Current liability $70,000 Long-term liability 630, 000 Kornett Company POST-CLOSING TRIAL BALANCE December 31, 2016 CREDIT DEBIT ACCOUNT TITLE 4,500.00 243.960.00 100,000.00 470,000.00 1 Petty Cash 2 Cash 3 Notes Receivable 4 Accounts Receivable 5 Allowance for Doubtful Accounts 6 Merchandise Inventory 7 Interest Receivable 16,000.00 20,000.00 1,875.00 45.640.00 13,400.00 654,925.00 900,000.00 Prepaid Insurance Office Supplies 10 Land s Buildings Instructions 11 Buildings 12 Accumulated Depreciation-Buildings 13 Office Equipment 14 Accumulated Depreciation-Office Equipment 15 Store Equipment 16 Accumulated Depreciation-Store Equipment 17 Mineral Rights 900,000.00 36,000.00 246,000.00 44,000.00 112,000.00 5,000.00 546,000.00 30.000.00 18 Accumulated Depletion 19 Patents 20 Social Security Tax Payable 2 42.000.00 25.470.00 4.710.00 40J000L00 270.00 40.00 157/000.00 Medicare Tax Payable 22 Employees Federal Income Tax Payable s State Unemployment Tax Payable 24 Federat Unemployment Tax Payablie 2s Sataries Payable Instructions z1 Medicare Tax Payable 22 Employees Federal Income Tax Payable 23 State Unemployment Tax Payable 24 Federal Unemployment Tax Payable 2s Salaries Payable 26 Accounts Payable 27 Interest Payable 28 Product Warranty Payable 29 Vacation Pay Payable 30 Unfunded Pension Liability 1 Notes Payable 22 1.Kornett. Capital ss Totals 4.710.00 40,000.00 270.00 40.00 157.000.00 131.600.00 28.000.00 76.000.00 10.500.00 50.700.00 700,000.00 2.345.010.00 3,700.300.00 3.700,300.00