P4-12. Transaction Analysis; Journal Entries, Posting, Unadjusted Trial Balance, Adjusting Journal Entries, Adjusted Trial Balance, Financial Statements, Closing Entries, Post-Closing Trial Balance. The Jiayin Li Corporation, which is a technology company, was formed on January 1 of the current year. Transactions completed during the first year of operation follow. January 1: January 10: 1 February 10: February 14: March 1: March 15: April 3: April 17: May 1: May 7: May 8: May 24: June 4: Issued 1,000,000 shares of common stock for $15,000,000, which is the par value of the stock. Acquired equipment in exchange for $2,000,000 cash and a $5,000,000 note payable. The note is due in 10 years. Paid $48,000 for a business insurance policy covering the two-year period beginning on March 1. Purchased $900,000 of supplies on account. Paid wages of $195,000. Billed $2,500,000 for services rendered on account. Paid $125,000 of the amount due on the supplies purchased on February 14. Billed $2,000,000 for services rendered on account. Paid wages of $200,000. Collected $200,500 of the outstanding accounts receivable. Received bill and paid $96,500 for utilities. Paid $40,000 for sales commissions. Made the first payment on the note issued on January 10. The payment consisted of $50,000 of interest and $150,000 to be applied against the principal of the note. Billed customers for $646,000 of services rendered. Collected $450,000 on accounts receivable. Purchased $45,000 of supplies in cash. Paid $120,000 for administrative expenses. June 18: June 29: July 10: Aug 25: Sept 23: October 1: Nov 23: Dec 19: 2 Paid $35,500 for warehouse repairs. Paid wages of $100,000. Purchased supplies for $500,000 on account. Collected $150,000 in advance for services to be provided in December and January of the following year. Declared and paid a $20,000 dividend to shareholders. Dec 30: The chart of accounts used by Jiayin Li is presented here: Chart of Accounts Group Account # Account Title 100: Assets 101 102 103 104 110 112 201 200: Liabilities 3 202 203 210 220 301 300: Stockholders' Equity Cash Accounts Receivable Supplies Prepaid Insurance Equipment Accumulated Depreciation Equipment Accounts Payable Unearned Service Revenue Wages Payable Interest Payable Notes Payable Common Stock Retained Earnings Dividends Service Revenue Wage Expense Utilities Expense Selling Expense Administrative Expense Repairs Expense Insurance Expense Depreciation Expense-Equipment Interest Expense Income Summary 310 320 401 400: Revenues 500: Expenses 501 502 503 504 505 506 510 520 600: Other 601 4 a. Journalize the transactions for the year. b. Post the journal entries to t-accounts. c. Prepare an unadjusted trial balance as of December 31. d. Journalize and post adjusting entries to t-accounts based on the following additional information. i. Ten months of the insurance policy had expired by the end of the year. ii. Depreciation for the equipment is $380,000. iii. The company provided a portion of the services related to the advance collection of December 19. The company recognized $50,000 as service revenue for services performed. iv. An additional $160,000 of interest had accrued on the note by the end of the year. v. Jiayin Li Corporation accrued wages in the amount of $200,000. e. Prepare an adjusted trial balance as of December 31. f. Prepare a single-step income statement and statement of stockholders' equity for the current year and a classified balance sheet as of the end of the year. g. Journalize and post closing entries. h. Prepare a post-closing trial balance as of December 31. X Excel Project Autograded Excel Project available in MyLab Accounting P4-12. Transaction Analysis; Journal Entries, Posting, Unadjusted Trial Balance, Adjusting Journal Entries, Adjusted Trial Balance, Financial Statements, Closing Entries, Post-Closing Trial Balance. The Jiayin Li Corporation, which is a technology company, was formed on January 1 of the current year. Transactions completed during the first year of operation follow. January 1: January 10: 1 February 10: February 14: March 1: March 15: April 3: April 17: May 1: May 7: May 8: May 24: June 4: Issued 1,000,000 shares of common stock for $15,000,000, which is the par value of the stock. Acquired equipment in exchange for $2,000,000 cash and a $5,000,000 note payable. The note is due in 10 years. Paid $48,000 for a business insurance policy covering the two-year period beginning on March 1. Purchased $900,000 of supplies on account. Paid wages of $195,000. Billed $2,500,000 for services rendered on account. Paid $125,000 of the amount due on the supplies purchased on February 14. Billed $2,000,000 for services rendered on account. Paid wages of $200,000. Collected $200,500 of the outstanding accounts receivable. Received bill and paid $96,500 for utilities. Paid $40,000 for sales commissions. Made the first payment on the note issued on January 10. The payment consisted of $50,000 of interest and $150,000 to be applied against the principal of the note. Billed customers for $646,000 of services rendered. Collected $450,000 on accounts receivable. Purchased $45,000 of supplies in cash. Paid $120,000 for administrative expenses. June 18: June 29: July 10: Aug 25: Sept 23: October 1: Nov 23: Dec 19: 2 Paid $35,500 for warehouse repairs. Paid wages of $100,000. Purchased supplies for $500,000 on account. Collected $150,000 in advance for services to be provided in December and January of the following year. Declared and paid a $20,000 dividend to shareholders. Dec 30: The chart of accounts used by Jiayin Li is presented here: Chart of Accounts Group Account # Account Title 100: Assets 101 102 103 104 110 112 201 200: Liabilities 3 202 203 210 220 301 300: Stockholders' Equity Cash Accounts Receivable Supplies Prepaid Insurance Equipment Accumulated Depreciation Equipment Accounts Payable Unearned Service Revenue Wages Payable Interest Payable Notes Payable Common Stock Retained Earnings Dividends Service Revenue Wage Expense Utilities Expense Selling Expense Administrative Expense Repairs Expense Insurance Expense Depreciation Expense-Equipment Interest Expense Income Summary 310 320 401 400: Revenues 500: Expenses 501 502 503 504 505 506 510 520 600: Other 601 4 a. Journalize the transactions for the year. b. Post the journal entries to t-accounts. c. Prepare an unadjusted trial balance as of December 31. d. Journalize and post adjusting entries to t-accounts based on the following additional information. i. Ten months of the insurance policy had expired by the end of the year. ii. Depreciation for the equipment is $380,000. iii. The company provided a portion of the services related to the advance collection of December 19. The company recognized $50,000 as service revenue for services performed. iv. An additional $160,000 of interest had accrued on the note by the end of the year. v. Jiayin Li Corporation accrued wages in the amount of $200,000. e. Prepare an adjusted trial balance as of December 31. f. Prepare a single-step income statement and statement of stockholders' equity for the current year and a classified balance sheet as of the end of the year. g. Journalize and post closing entries. h. Prepare a post-closing trial balance as of December 31. X Excel Project Autograded Excel Project available in MyLab Accounting