P3-1 (Transactions, Financial StatementsService Company) Listed below are the transactions of Yasunari Kawabata, D.D.S., for the month
Question:
P3-1 (Transactions, Financial StatementsService Company) Listed below are the transactions of
Yasunari Kawabata, D.D.S., for the month of September.
Sept. 1 Kawabata begins practice as a dentist and invests $20,000 cash.
2 Purchases dental equipment on account from Green Jacket Co. for $17,280.
4 Pays rent for office space, $680 for the month.
4 Employs a receptionist, Michael Bradley.
5 Purchases dental supplies for cash, $942.
8 Receives cash of $1,690 from patients for services performed.
10 Pays miscellaneous office expenses, $430.
14 Bills patients $5,820 for services performed.
18 Pays Green Jacket Co. on account, $3,600.
19 Withdraws $3,000 cash from the business for personal use.
20 Receives $980 from patients on account.
25 Bills patients $2,110 for services performed.
30 Pays the following expenses in cash: Salaries and wages $1,800; miscellaneous office expenses $85.
30 Dental supplies used during September, $330.
P3-10 (Adjusting and Closing) Presented below is the December 31 trial balance of New York Boutique. NEW YORK BOUTIQUE TRIAL BALANCE DECEMBER 31 Debit Credit Cash $ 18,500 Accounts Receivable 32,000 Allowance for Doubtful Accounts $ 700 Inventory, December 31 80,000 Prepaid Insurance 5,100 Equipment 84,000 Accumulated DepreciationEquipment 35,000 Notes Payable 28,000 Common Stock 80,600 Retained Earnings 10,000 Sales Revenue 600,000 Cost of Goods Sold 408,000 Salaries and Wages Expense (sales) 50,000 Advertising Expense 6,700 Salaries and Wages Expense (administrative) 65,000 Supplies Expense 5,000 $754,300 $754,300 Instructions (a) Construct T-accounts and enter the balances shown. (b) Prepare adjusting journal entries for the following and post to the T-accounts. (Omit explanations.) Open additional T-accounts as necessary. (The books are closed yearly on December 31.) (1) Bad debt expense is estimated to be $1,400. (2) Equipment is depreciated based on a 7-year life (no salvage value). (3) Insurance expired during the year $2,550. (4) Interest accrued on notes payable $3,360. (5) Sales salaries and wages earned but not paid $2,400. (6) Advertising paid in advance $700. (7) Office supplies on hand $1,500, charged to Supplies Expense when purchased. (c) Prepare closing entries and post to the accounts. Kieso, Donald E.; Weygandt, Jerry J.; Warfield, Terry D.. Intermediate Accounting, 15th Edition, 2014 FASB Update (Page 149). Wiley Higher Ed. Kindle Edition.