Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Problem 12.4A Objectives 12-1, 12-2, 12-3, 12-4 Recording adjustments and completing the worksheet. The Green Thumb Gardener is a retail store that sells plants, soil,

image text in transcribed
image text in transcribed
Problem 12.4A Objectives 12-1, 12-2, 12-3, 12-4 Recording adjustments and completing the worksheet. The Green Thumb Gardener is a retail store that sells plants, soil, and decorative pots. On December 31, 2019, the firm's general ledger contained the accounts and balances that appear below. INSTRUCTIONS 1. Prepare the Trial Balance section of a 10-column worksheet. The worksheet covers the year ended December 31, 2019. 2. Enter the adjustments below in the Adjustments section of the worksheet. Identify each adjust ment with the appropriate letter. 3. Complete the worksheet. ACCOUNTS AND BALANCES Cash $ 6,700 Dr. Accounts Receivable 3,600 Dr. Allowance for Doubtful Accounts 62 Cr. Merchandise Inventory 12,300 Dr. Supplies 1,300 Dr. Prepaid Advertising 1,080 Dr. Store Equipment 8.700 Dr. Accumulated Depreciation-Store Equipment 1.600 Cr. Office Equipment 2,200 Dr. Accumulated Depreciation - Office Equipment 380 C. Accounts Payable 2,725 Cr. Social Security Tax Payable 530 Cr. Medicare Tax Payable 88 Cr. Federal Unemployment Tax Payable State Unemployment Tax Payable Salaries Payable Beth Argo, Capital 30,677 Cr. Beth Argo, Drawing 21,000 Dr. Sales 95,048 Cr. Sales Returns and Allowances 1.200 Dr. Purchases 49.400 Dr. Purchases Returns and Allowances 530 Cr. Rent Expense 7,000 Dr. Telephone Expense 690 Dr. Salaries Expense 15,100 Dr. Payroll Taxes Expense 1,370 Dr. Income Summary Supplies Expense Advertising Expense Depreciation Expense-Store Equipment Depreciation Expense-Office Equipment Uncollectible Accounts Expense 90 CHAPTER 12 Accruals, Deferrals, and the Worksheet ADJUSTMENTS a.-b. Merchandise inventory on December 31, 2019, is $13,321. c. During 2019, the firm had net credit sales of $45.000: the firm estimates that 0.5 percent of these sales will result in uncollectible accounts. d. On December 31, 2019, an inventory of the supplies showed that items costing $325 were on hand e. On October 1, 2019, the firm signed a six-month advertising contract for $1,080 with a local newspaper and paid the full amount in advance. f. On January 2, 2018, the firm purchased store equipment for $8,700. At that time, the equip- ment was estimated to have a useful life of five years and a salvage value of $700. g. On January 2, 2018, the firm purchased office equipment for $2,200. At that time, the equip- ment was estimated to have a useful life of five years and a salvage value of $300. h. On December 31, 2019, the firm owed salaries of $1,930 that will not be paid until 2020. i. On December 31, 2019, the firm owed the employer's social security tax (assume 6.2 percent) and Medicare tax (assume 1.45 percent) on the entire $1,930 of accrued wages. i. On December 31, 2019, the firm owed federal unemployment tax (assume 0.6 percent) and state unemployment tax (assume 5.4 percent) on the entire $1,930 of accrued wages. Analyze: By what amount were the assets of the business affected by adjustments

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

Contemporary Auditing Real Issues And Cases

Authors: Michael C. Knapp, Loreen Knapp

5th Edition

032418834X, 978-0324188349

More Books

Students also viewed these Accounting questions

Question

What is the effect of word war second?

Answered: 1 week ago