Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Note: You must complete Comprehensive Problem 4 (Part A) before completing Comprehensive Problem 4 (Part B). Required: 1. After all of the transactions for the
Note: You must complete Comprehensive Problem 4 (Part A) before completing Comprehensive Problem 4 (Part B).
Required: | |||||||||
1. | After all of the transactions for the year ended December 31, 20Y8, had been posted [including the transactions recorded in part (1) and all adjusting entries], the data that follow were taken from the records of Equinox Products Inc.
|
Income Statement data: | |
Advertising expense | $ 150,000 |
Cost of goods sold | 3,700,000 |
Delivery expense | 30,000 |
Depreciation expense-office buildings and equipment | 30,000 |
Depreciation expense-store buildings and equipment | 100,000 |
Income tax expense | 140,500 |
Interest expense | 21,000 |
Interest revenue | 30,000 |
Miscellaneous administrative expense | 7,500 |
Miscellaneous selling expense | 14,000 |
Office rent expense | 50,000 |
Office salaries expense | 170,000 |
Office supplies expense | 10,000 |
Sales | 5,313,000 |
Sales commissions | 185,000 |
Sales salaries expense | 385,000 |
Store supplies expense | 21,000 |
Retained earnings and balance sheet data: | |
Accounts payable | $ 194,300 |
Accounts receivable | 545,000 |
Accumulated depreciationoffice buildings and equipment | 1,580,000 |
Accumulated depreciationstore buildings and equipment | 4,126,000 |
Allowance for doubtful accounts | 8,450 |
Bonds payable, 5%, due in 10 years | 500,000 |
Cash | 282,850 |
Common stock, $20 par | |
(400,000 shares authorized; 100,000 shares issued, 94,600 outstanding) | 2,000,000 |
Dividends: | |
Cash dividends for common stock | 155,120 |
Cash dividends for preferred stock | 100,000 |
Goodwill | 700,000 |
Income tax payable | 44,000 |
Interest receivable | 1,200 |
Inventory (December 31, 20Y8), | |
at lower of cost (FIFO) or market | 778,000 |
Office buildings and equipment | 4,320,000 |
Paid-in capital from sale of treasury stock | 13,000 |
Excess of issue price over par: | |
-Common | 886,800 |
-Preferred | 150,000 |
Preferred 5% stock, $80 par | |
(30,000 shares authorized; 20,000 shares issued) | 1,600,000 |
Premium on bonds payable | 19,000 |
Prepaid expenses | 27,400 |
Retained earnings, January 1, 20Y8 | 8,197,220 |
Store buildings and equipment | 12,560,000 |
Treasury stock | |
(5,400 shares of common stock at cost of $33 per share) | 178,200 |
CHART OF ACCOUNTS | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equinox Products, Inc. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
General Ledger | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
Labels | |
Current assets | |
Current liabilities | |
December 31, 20Y8 | |
Dividends | |
For the Year Ended December 31, 20Y8 | |
Intangible assets | |
Investments | |
Long-term liabilities | |
Operating expenses | |
Other revenue and expense | |
Paid-in capital | |
Property, plant, and equipment | |
Amount Descriptions | |
Accounts receivable, net | |
Available-for-sale investments | |
Change in retained earnings | |
Excess of issue price over par | |
From sale of treasury stock | |
Gross profit | |
Income before income tax | |
Income from operations | |
Miscellaneous selling expense | |
Net income | |
Net loss | |
Office buildings and equipment, net value | |
Paid-in capital, common stock | |
Paid-in capital, preferred stock | |
Retained earnings, January 1, 20Y8 | |
Retained earnings, December 31, 20Y8 | |
Sales commissions | |
Sales salaries expense | |
Store buildings and equipment, net value | |
Store supplies expense | |
Total administrative expenses | |
Total assets | |
Total (before treasury stock) | |
Total current assets | |
Total current liabilities | |
Total liabilities | |
Total liabilities and stockholders equity | |
Total long-term liabilities | |
Total investments | |
Total operating expenses | |
Total paid-in capital | |
Total property, plant, and equipment | |
Total selling expenses | |
Total stockholders equity |
I AM PUTTING PART 1 THAT IS ALREADY DONE DOWN BELOW!
THANK YOU IN ADVANCE! IM NOT UNDERSTANDING PLEASE HELP!
Page 10 Journal
Date | Accounts titles and Explanation | Debit ($) | Credit ($) |
Jan.3 | Cash (15,000 * $30) | 450,000 | |
Common stock (15,000 * $20) | 300,000 | ||
Paid-in capital in excess of par-common stock | 150,000 | ||
(To record issuance of common stock) | |||
Feb.15 | Cash (4,000*$100) | 400,000 | |
Preferred stock (4,000 * $80) | 320,000 | ||
Paid-in capital in excess of par-preferred stock | 80,000 | ||
(To record issuance of preferred stock) | |||
May 1 | Cash ($500,000 * 104/100) | 520,000 | |
Premium on bonds payable | 20,000 | ||
Bonds payable | 500,000 | ||
(To record issuance of bonds payable) | |||
May 16 | Cash dividends ($0.50 * 100,000) | 50,000 | |
Cash dividends payable | 50,000 | ||
(To record cash dividends declared on common shares) | |||
May 16 | Cash dividends ($1.00 * 20,000) | 20,000 | |
Cash dividends payable | 20,000 | ||
(To record cash dividends declared on preferred shares) | |||
May 26 | Cash dividends payable | 70,000 | |
Cash (50,000+20,000) | 70,000 | ||
(To record payment of cash dividends declared) | |||
June 8 | Treasury stock (8,000 x*$33) | 264,000 | |
Cash | 264,000 | ||
(To record purchase of treasury stock) | |||
June 30 | Cash dividends ($1.00 * 20,000) | 20,000 | |
Cash dividends payable | 20,000 | ||
(To record cash dividends declared on preferred stock) | |||
July 11 | Cash dividends payable | 20,000 | |
Cash | 20,000 | ||
(To record payment of cash dividends declared) |
Page 11 Journal
Date | Accounts titles and Explanation | Debit ($) | Credit ($) |
Oct.7 | Cash (2,600 * $38) | 98,800 | |
Treasury stock (2,600 * $33) | 85,800 | ||
Paid-in capital from sale of treasury stock | 13,000 | ||
(To record sale of treasury stock) | |||
Oct.31 | Interest expense | 11,500 | |
Premium on bonds payable ($20,000/20) | 1,000 | ||
Cash ($500,000 * 5% * 6/12) | 12,500 | ||
(To record semiannual interest payment and amortization of premium) |
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started