GL 1201 - Based on Exercise 12-11 LO P2, P3, A1

finding the general journal pictured and cash paid to retire notes

GL1201 - Based on Exercise 12-11 LO P2, P3, A1 Use the following financial statements and additional information. 2018 SMITH INC. Comparative Balance Sheets June 30, 2019 and 2018 2019 Assets Cash $116,500 Accounts receivable, net 68,000 Inventory 63,000 Prepaid expenses 4,400 Total current assets 251,900 Equipment 127,000 Accum. depreciation-Equipment (33,000) Total assets $345, 900 Liabilities and Equity Accounts payable $ 26,000 Wages payable 6,000 Income taxes payable 3,600 Total current liabilities 35,600 Notes payable (long term) 33,000 Total liabilities 68,600 Equity Common stock, $5 par value 240,000 Retained earnings 37,300 Total liabilities and equity $345, 900 $ 60,500 53,000 88,000 5,500 207,000 118,000 (11,000) $314,000 $ 32,000 16,000 4,000 52,000 65,000 117,000 170,000 27,000 $314,000 $685,000 419,000 266,000 SMITH INC. Income Statement For Year Ended June 30, 2019 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense $60,000 Other expenses 68,000 Total operating expenses Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income 128,000 138,000 2,100 140, 100 42,880 $ 97,220 Additional Information a. A $33,000 note payable is retired at its $33,000 carrying (book) value in exchange for cash. b. The only changes affecting retained earnings are net income and cash dividends paid. c. New equipment is acquired for $59,000 cash. d. Received cash for the sale of equipment that had cost $50,000, yielding a $2,100 gain. e. Prepaid Expenses and Wages Payable relate to Other Expenses on the income statement. f. All purchases and sales of inventory are on credit. Journal entry worksheet Reconstruct the journal entry for cash receipts from customers, incorporating the change in the related balance sheet account(s), if any. Note: Enter debits before credits. Date Account Title Debit Credit Jun 30 Cash Accounts receivable, net Record entry Clear entry View general journal Journal entry worksheet Reconstruct the journal entry for cash paid for operating expenses, incorporating the change in the related balance sheet account(s), if any. Note: Enter debits before credits. Date Account Title Debit Credit Jun 30 Record entry Clear entry View general journal Journal entry worksheet Reconstruct the journal entry for income taxes expense, incorporating the change in the related balance sheet account(s), if any. Note: Enter debits before credits. Date Account Title Debit Credit Jun 30 Record entry Clear entry View general journal Journal entry worksheet Reconstruct the entry to record the retirement of the $33,000 note payable at its $33,000 carrying (book) value in exchange for cash. Note: Enter debits before credits. Date Account Title Debit Jun 30 Credit Record entry Clear entry View general journal Journal entry worksheet