Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Pen Station is a stationery shop in the town if Upper Hand serving individuals and small businesses in the local community.Two Bentley University graduates founded

Pen Station is a stationery shop in the town if Upper Hand serving individuals and small businesses in the local community.Two Bentley University graduates founded the company and issued $75,000 of stock in January 2023. Your mission is to assist Jordan with these transactions and to prepare financial statements for the month of December 2023.
Pen Station
REGULAR TRANSACTIONS NOT RECORDED YET:
TRANSACTION 1 Pen Station sent promotion flyers worth $1,800 to potential customers in the area. They sent them out in December 2023, and paid immediately.
TRANSACTION 2 Upper Hand's Lonely Hearts Club meets in the shop once a week after hours. They signed an agreement for 12 months, starting on January 1,2024, and paid the whole amount of $36,000 in December 2023.
TRANSACTION 3 Pen Station bought a new insurance policy for the year of 2024(January 1- December 31), and paid $6,000 in cash.
TRANSACTION 4 Cleaning and decorating supplies for the office amounting to $750 have been purchased and used up in December 2023.
TRANSACTION 5 On December 18 a customer brought a $4,200 payment for his November purchase, but Pen Station did not record it yet.
ADJUSTING TRANSACTIONS:
NOTE: All prior months' adjustements have been properly recorded. Only adjustments listed below need to be recorded for December.
TRANSACTION 1 Pen Station's payroll for a full, five-day week is $5,000. Employees receive the paychecks at the beginning of next week. There has been four more workdays in 2023 after the last paychecks were issued.
TRANSACTION 2 The December 2023 rent is $4,500. It was pre-paid in November.
TRANSACTION 3 Pen Station invited 1-2-Tree Company to set up seasonal decorations. They visited the office on December 2,2023, and left an invoice for $450. The payment is not due until late January.
TRANSACTION 4 The last customer of the year just purchased $4,500 worth of stationery. Pen Station needs to issue an invoice with due date in February 2024.
TRANSACTION 5 While reviewing the unearned revenue balance and sales records, Jordan found that $12,500 of the balance was earned during December 2023, but has not been recorded yet.
image text in transcribed

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Accounting in an Economic Context

Authors: Jamie Pratt

8th Edition

9781118139424, 9781118139431, 470635290, 1118139429, 1118139437, 978-0470635292

Students also viewed these Accounting questions

Question

1. Give extra points for correct and creative answers.

Answered: 1 week ago

Question

Does it avoid using personal pronouns (such as I and me)?

Answered: 1 week ago

Question

Does it clearly identify what you have done and accomplished?

Answered: 1 week ago