I am little lost on the journal entries. Can somebody help me? I just want to make sure i am doing them right.

She told us the Premium should be 8,752 but I can't seem to get that as an answer.

Is January 4th a Current asset since they are holding it for a year or less?

Spring Company has the following opening account balances in its general ledger on January 1. All balances are normal balances. Spring uses all typical accounts used by a merchandising business. Listed below are accounts with balances other than zero. Snow uses the perpetual inventory system, records all sales by the net method, records sales returns and allowances as they occur (does not estimate at time of sale), records purchases by the gross method, and applies the cost method to account for treasury stock.

Jan 1 Issued $100,000, 5-year, debenture 7% bonds with a yield of 5%. Interest payable semiannually on June

30 and December 31. (DO NOT attempt to compute accrued interest; treat January 2 as if it had been an

issuance on an interest payment date.)

Jan 3 Sold merchandise on account, FOB shipping point, 2/10,n/30, $5,900. Cost of merchandise sold, $3500.

Jan 4 Purchased 500 shares of Tulips Inc. outstanding common stock at $88 per share. Management intends to

hold this security for one year or less. Spring is not able to exercise significant influence over Tulips.

Jan 5 Purchased merchandise on account, FOB shipping point, n/45, $2,700.

Jan 7 Collected $1,370 from customers on account; discounts taken as originally recorded.

Jan 8 Paid freight charges on merchandise purchased on Jan. 5, $180.

Jan 9 Paid creditors on account, $25,000; no discounts taken.

Jan 9 Received returned merchandise from sale of Jan. 3; granted customer credit for $300 of billed sales. Cost

of merchandise returned was $180.

Jan 10 Cash sales for January 1 through 10 total $15,500. Cost of merchandise sold, $9200.

11 Sold merchandise on account, FOB shipping point, 2/10,n/30, $2,800. Cost of merchandise sold, $1700.

12 Paid January rent for the warehouse, $2,000.

14 Collected amount due from sale of January 11. Customer took advantage of discount.

15 Declared and paid dividends of $0.40 per share on outstanding shares of common stock.

16 Purchased merchandise on account, FOB destination, 1/15,n/45, $30,400.

17 Paid cash for office supplies, $400.

18 Returned $200 of merchandise purchased on Jan. 16 receiving credit from supplier.

20 Cash sales for January 11 through 20 total $17,500. Cost of merchandise sold $10500.

20 Collected amount due from sale of January 3, less return of January 9. (Note: discount period expired).

21 Paid one-half of amount due on purchase of January 16 after consideration of Jan. 18 return. Took

advantage of early pay discount.

22 Issued 90-day, 3%, $15,100 note payable for remainder of amount owed on Jan. 16 purchase.

23 Purchased new equipment by issuing 100 shares of stock at $12 per share and paying $5,000 in cash. In

addition, paid installation costs of $500.

25 Sold for $350 old equipment with an original cost of $1,100 and accumulated depreciation of $650.

28 Recorded and paid monthly sales salaries of $4,300 and office salaries of $2,600. (Not previously

accrued; ignore withholdings)

30 Cash sales for January 21 through 30 total $19,920. Cost of merchandise sold, $11950.

31 Paid $400 cash for repair and maintenance on existing equipment.

31 Announced a 2 for 1 stock split on all issued shares.

31 Purchased 500 shares of our own stock to hold temporarily paying $8 per share.