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Kearney Cottage Corporation ( KEARNEY CORP ) is a service company that was started January 1 , 2 0 2 3 , by Randy and

Kearney Cottage Corporation (KEARNEY CORP) is a service company that was started January 1,2023, by Randy and Sandynewly married -- to offer wealthy clients from the Toronto area complete support for the care and upkeep of their second homes located in Muskoka and even farther north. KEARNEY allows wealthy clients to enjoy their recreational cottages over their weekends and holidays without expending their precious recreational time for maintenance. Kearney Cottage Corporation provides interior cleaning as well as exterior maintenance such as lawn cutting, landscaping, and gardening outside the home, and in the winter also includes snowplowing.
Over the course of the first year of operations, the following events occurred:
Jan 1: Randy and Sandy go to the bank and set up a company bank account and transfer $250,000 of their personal funds to the company bank account. They then wrote a check to pay for the incorporation service.
Jan 2: Randy and Sandy incorporate Kearney Cottage Corporation using an online incorporation service. The service charges them $20000 to incorporate the company with two shareholders. Each spouse received 100 shares in the corporation.
Jan 3: Randy and Sandy borrow $4,500,000 from the bank (using their home as collateral) of which $2,000,000 is to purchase a small building in Huntsville, Ontario to store their equipment and to set up an office. The bank charges them 5% interest on the loan, which is to be repaid fully with all cumulative interest owing at the end of the 10 years.
Jan 4: KEARNEY purchase a commercial business insurance policy for general liability. The cost is $1200 per year which is paid monthly. The first payment is backdated to January 1.
Jan 5: KEARNEY purchases a Town of Huntsville business license for two calendar years at a cost of $5,000, which is paid with the company bank card.
Jan 30: Randy and Sandy buy several pieces of landscaping and cleaning equipment which include:
a)2 Industrial Vacuums: $5000 each expected to last 10 years.
b)2 Industrial Riding Lawn Mowers: $10,000 each expected to last 5 years.
c) Two Used Trucks: $40,000 total expected to last 5 years
d) Two snowplows costing $3500 total to last 5 years.
e) One used snowplow costing $20000 each to last 10 years.
February 28: KEARNEY signs a contract with a local marketing firm. The marketing firm will receive $5,000 per month for the rest of the year.
March 1: Randy and Sandy pay $10,000 for design of a website, which will be good for 2 years before it needs to be redesigned.
April 1: Randy and Sandy joined a local golf club for $10,000 to meet the rich and wealthy as potential clients. At the first meet and greet they had 10 clients signed contracts to provide both cleaning and gardening support for their cottage. Each contract requires the client to pay $800 a month for 12 months in total starting May 1. Each client paid a $1600 deposit on April 1.
April 15: Randy and Sandy buy grass seed and fertilizer to be applied after every lawn cutting at a cost of $2000 that will have to be replenished on September 1.
April 30: During the month, Randy and Sandy went to a charity dinner to promote Kearney Corp services. They spent $600 on tickets and paid with a personal bank card.
May-December 31:
KEARNEY Corporation had revenues of $800,000. This amount does not include the original deposit and fees provided by the 10 clients on April 1.
Between May 1st and December 31st, KEARNEY Corporation paid $1800 a month for gas and oil for the Trucks, Lawn Mowers and Snowblowers.
On October 31st, Randy and Sandy got the trucks and snowplow winterized for $1500 each and the Snowblowers serviced for $250 each.
Cash wage payments for the year were $45,000.
Required:
1) Please prepare all the journal entries, general ledgers (you can use T accounts) as well as adjusting entries and an Adjusted Trial Balance: All in Good Form. Assume that the building is depreciated on a straight-line basis over 30 years. All journal entries must be dated and include an explanation. If there are any events that do not require a journal entry, please provide an explanation as to why not.

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