Individual Case Assignment: Debits and Credits through Financials Margie Company needs your help to record and summarize its accounting transactions for 2014 and to prepare its financial statements for that year. Margie Company provided you with the following Balance Sheet for 2013. (Note that this balance sheet is not properly classified) Assets: Cash Accounts Receivable Merchandise Inventory (net of discounts) Prepaid Rent Supplies Prepaid Insurance Land Building Accumulated Depreciation - Bldg. Equipment Accumulated Depreciation-Equip Patent m. New equipment costing $23,000 was purchased on August 1. Maggie paid $4,000 down and issued a 1 year, 7.5% note for the balance n New equipment costing $ 120,000 was purchased on Nov. 12 for $120,000, $90,000 was paid in cash and 4,800 shares of Common Stock was issued for the equipment. o. Payment to vendors for merchandise totaled $483,000. p. Collections of Accounts Receivable totaled $ 411,000 q. Declared and paid dividends of $11,800 during the year I. The income taxes due at the beginning of the year were paid. 3. The insurance policy in effect at the beginning of 2014 expired on 4/1/14. At that time, a new one year policy costing $ 26,250 was purchased Additional end of year information: a. Salaries earned by employees but unpaid as of year-end totaled $7,500. b. Supplies on hand at year-end totaled $3,950. c. Depreciation expense on the equipment for the year was determined to be $7,500 $ 57,000 83,000 167,000 3,500 3,300 6,000 55,000 150,000 -20,000 130,000 80,000 -29,000 Total Assets: 51,000 20,000 $575,800 Required: d. Depreciation expense on the building for the year was determined to be $ 15,800 e. The marginal income tax rate is 30%. The taxes are to be paid in March of 2015. f. Prepaid rent as of year-end totaled $5,000. Liabilities & Stockholders' Equity 1. Prepare the journal entries for the year, based on the summary data provided 2. $ 88,000 11,000 6,800 45,000 Prepare the year-end adjusting entries based on the additional end of year information. For each, determine if it is an accrual or a deferral and explain your answer. 3. Prepare in good form for 2014: a. Income Statement b. Statement of Equity c. Balance Sheet Please hand in your Excel spreadsheet via email. Be sure the spreadsheet is easy to read/navigate. Accounts Payable (all for merchandise inventory) Wages Payable Income Taxes Payable Notes Payable, 7% (due in 6 months) Bonds Payable, 8% (Matures in 2018) (Interest payments due each 12/31) Common Stock -No Par 80,000 305,000 Retained Earnings 40,000 Total Liabilities & Stockholders' Equity: $575,800 The following summary events occurred in 2014: a. Cash sales totaled $140,000. b. Credit sales totaled $420,000 c. Credit card sales totaled $280,000. (The credit card company charges Margie Company 4% on sales and transfers the net amount directly to Margie's bank account.) d. Purchases of merchandise inventory on account totaled $470,000, terms 2/10 N/30. Margie records all purchases at net and takes advantages of all discounts. e. Cost of merchandise sold totaled $502,000 f. Salaries paid to employees totaled $85,000. Utilities paid during the year totaled $79,000 Rent paid for special equipment that can only be leased totaled $ 60,000. i Supplies purchased during the year totaled $12,400 j. Equipment which had cost $15,000 and had accumulated depreciation of $6,000 was sold for $7,300. k Borrowed $33,000 on a six month, 9% note on November 1 1. Issued an additional 10,000 shares of Common Stock for a total of $57,000 cash