Mason Automotive is an automotive parts company that sells car parts and provides car service to customers. This is Mason's first year of operations and they have hired you as their CPA to prepare the income statement and balance sheet for their company. As such, January 1st, 2023 was the first day that Mason was in business. For the month of August, record all the necessary journal entries for transactions that occurred during the month. In addition, please prepare all necessary adjusting journal entries as of the end of the month. From the information below, please fill out the journal cntries tab for all the necessary journal entries. Furthermore, please complete the TAccounts' tab for the individual accounts so that the 'trial balance' tab can be updated (automatically). I prepared the first journal entry for you in the iournal entrics tab and I nccounts tab. Ensure you label the entries how I have for Entry H1. Once all entries are recored and the T.Accounts tab is updated, please prepare the financial statements (income statement and balance sheet) for the month of January Activity For The Month of August \begin{tabular}{|c|l|} \hline 1 & \multicolumn{1}{|c|}{ Activity For The Month of August } \\ \hline & Mason Automotive sells 7,350,000 shares at $6 par for $20 on January 1st, 2023. \\ \hline 2 & OnJanuary3rd,MasonAutomotivereceives$39.6Millionadvancepaymentfromacustomer,Highlandinc,tomanufacture6,820cars. \\ \hline 3 & Mason Automotive pre-pays for rent Expense for the next five years of $25 Million on January 1st, 2023. \\ \hline & MasonAutomotivepurchased$162MilliondollarsworthofinventoryonJanuary5th,2023.$79.2Millionwaspaidwithcashwiththeremainingbalanceonaccount.Masonnotesthatitwilluseaperpetualinventorysystemtotrackinventory. \\ \hline & MasonAutomotivebuysapatentfromApplefor$19.965MilliononJanuary1st,2023.Thepatenthasalegallife \\ \hline \end{tabular} 5 of 22 years and useful life of 21 years. Record the necessary entry as of January 1st,2023. Assume the patent was purchased using cash. Mason Automotive issues a bond payable on lanuary 1st, 2023 with a face value of Si17 Milion at 95 . The bond will have a useful life of 10 years with an interest payment of 9.25% (Annual Percentage Rate) due at the end of the month. Record the necessary journal entry as of January 15t,2023. Note: When considering the amortization of the discount or premium, assume the straight line method is used. interest will be accrued on a monthly basis. On January 15th, Mason Automotive shipped two orders to Panther Paws Corporation. The shipping terms were FOB Destination. The first part of the delivery was received by Pather Pavis on January 17 th with a sales value of $178.2 Milion and the inventory cost was $95.7 Million. The second part of the delivery was received on February 3rd with a sales value of $250 Million and an inventory cost of $175Million. Assume that this sale was made on account. 8 Mason Automotive purchased \$8 Million dollars worth of supplies on account on January 27 th, 2023. Mason Automotive purchases fixed assets of \$176 Million that will have a useful life of 14 years and a salvage 9 value of $55 million on January 15t, 2023. $70 million was paid with cash with the remaining balance on account. These assets are depreciated using the straight-line method. Ed Mason, the CEO, hires 3,870 employees, whom will recelve a combined salary of 57.38 Milion on a monthly basis. The employees started on danuary 1 st and will be paid for the month of January on February 6 th. 10 Employee's withholdings are as follows: 11\% for federal income taxes 5,6\% for state income taxes and 7.65\% for FICA. Record the necessary entry as of the date of hire, danuary 1st, 2023. On January 30th, Mason Automotive decides to purchase 142.000 shares of Treasury stock at \$22 per share. 11 Month End Adjusting Entries There are 10 applicable adjusting entries that need to be made as of the end of the month based on the information provided above. When recording these adjusting entries consider the following facts: 1 Record the necessary adjusting entries related to pre-paid expense as separate journal entries. 2 Interest expense will be recorded as an operating expense item on the income statement. As of the end of the month, 4,620 cars were completed for Highland Inc. and the performance obligation had been met on those 4,620 cars. As such, revenue was determined to be earned on those 4,620 vehicles and it was noted that each vehicle costed $3,300 to manufacture. (These journal entries are considered 2 of the 10 total 3 adjusting entries). When reviewing the supply room as of the end of the month, Mason Automation noted that it had $3 Million 4 worth of supplies still on hand. 5. There should be two separate entries related to payroll that is recorded. Mason Automation uses the balance sheet approach in estimating the allowance for doubtful accounts as of the 6 end of the period. Based on industry average, Mason noted that it will use 10% of recelvables as an estimation. Note on Balance Sheet: When preparing the balance sheet, close out net income to retained earnings. Adjusting Entries Ad) 1 Ad) 2 Ad] 3 Ad) 4 Ad) 5 Adj 6 Adj 7 Adj 8 Adj 9 Adj 10 Mason Automotive is an automotive parts company that sells car parts and provides car service to customers. This is Mason's first year of operations and they have hired you as their CPA to prepare the income statement and balance sheet for their company. As such, January 1st, 2023 was the first day that Mason was in business. For the month of August, record all the necessary journal entries for transactions that occurred during the month. In addition, please prepare all necessary adjusting journal entries as of the end of the month. From the information below, please fill out the journal cntries tab for all the necessary journal entries. Furthermore, please complete the TAccounts' tab for the individual accounts so that the 'trial balance' tab can be updated (automatically). I prepared the first journal entry for you in the iournal entrics tab and I nccounts tab. Ensure you label the entries how I have for Entry H1. Once all entries are recored and the T.Accounts tab is updated, please prepare the financial statements (income statement and balance sheet) for the month of January Activity For The Month of August \begin{tabular}{|c|l|} \hline 1 & \multicolumn{1}{|c|}{ Activity For The Month of August } \\ \hline & Mason Automotive sells 7,350,000 shares at $6 par for $20 on January 1st, 2023. \\ \hline 2 & OnJanuary3rd,MasonAutomotivereceives$39.6Millionadvancepaymentfromacustomer,Highlandinc,tomanufacture6,820cars. \\ \hline 3 & Mason Automotive pre-pays for rent Expense for the next five years of $25 Million on January 1st, 2023. \\ \hline & MasonAutomotivepurchased$162MilliondollarsworthofinventoryonJanuary5th,2023.$79.2Millionwaspaidwithcashwiththeremainingbalanceonaccount.Masonnotesthatitwilluseaperpetualinventorysystemtotrackinventory. \\ \hline & MasonAutomotivebuysapatentfromApplefor$19.965MilliononJanuary1st,2023.Thepatenthasalegallife \\ \hline \end{tabular} 5 of 22 years and useful life of 21 years. Record the necessary entry as of January 1st,2023. Assume the patent was purchased using cash. Mason Automotive issues a bond payable on lanuary 1st, 2023 with a face value of Si17 Milion at 95 . The bond will have a useful life of 10 years with an interest payment of 9.25% (Annual Percentage Rate) due at the end of the month. Record the necessary journal entry as of January 15t,2023. Note: When considering the amortization of the discount or premium, assume the straight line method is used. interest will be accrued on a monthly basis. On January 15th, Mason Automotive shipped two orders to Panther Paws Corporation. The shipping terms were FOB Destination. The first part of the delivery was received by Pather Pavis on January 17 th with a sales value of $178.2 Milion and the inventory cost was $95.7 Million. The second part of the delivery was received on February 3rd with a sales value of $250 Million and an inventory cost of $175Million. Assume that this sale was made on account. 8 Mason Automotive purchased \$8 Million dollars worth of supplies on account on January 27 th, 2023. Mason Automotive purchases fixed assets of \$176 Million that will have a useful life of 14 years and a salvage 9 value of $55 million on January 15t, 2023. $70 million was paid with cash with the remaining balance on account. These assets are depreciated using the straight-line method. Ed Mason, the CEO, hires 3,870 employees, whom will recelve a combined salary of 57.38 Milion on a monthly basis. The employees started on danuary 1 st and will be paid for the month of January on February 6 th. 10 Employee's withholdings are as follows: 11\% for federal income taxes 5,6\% for state income taxes and 7.65\% for FICA. Record the necessary entry as of the date of hire, danuary 1st, 2023. On January 30th, Mason Automotive decides to purchase 142.000 shares of Treasury stock at \$22 per share. 11 Month End Adjusting Entries There are 10 applicable adjusting entries that need to be made as of the end of the month based on the information provided above. When recording these adjusting entries consider the following facts: 1 Record the necessary adjusting entries related to pre-paid expense as separate journal entries. 2 Interest expense will be recorded as an operating expense item on the income statement. As of the end of the month, 4,620 cars were completed for Highland Inc. and the performance obligation had been met on those 4,620 cars. As such, revenue was determined to be earned on those 4,620 vehicles and it was noted that each vehicle costed $3,300 to manufacture. (These journal entries are considered 2 of the 10 total 3 adjusting entries). When reviewing the supply room as of the end of the month, Mason Automation noted that it had $3 Million 4 worth of supplies still on hand. 5. There should be two separate entries related to payroll that is recorded. Mason Automation uses the balance sheet approach in estimating the allowance for doubtful accounts as of the 6 end of the period. Based on industry average, Mason noted that it will use 10% of recelvables as an estimation. Note on Balance Sheet: When preparing the balance sheet, close out net income to retained earnings. Adjusting Entries Ad) 1 Ad) 2 Ad] 3 Ad) 4 Ad) 5 Adj 6 Adj 7 Adj 8 Adj 9 Adj 10