Problem 3-ZUA Part I Comprehensive Problem: Reviewing the Accounting Cycle Tarkington Freight Service provides delivery of merchandise to retail grocery stores in the Northeast. At the beginning of 2019, the following account balances were available: Cash $92,100 Accumulated Depreciation Accounts receivable 361,500 (Equipment) $580,000 Supplies 24,600 Land 304,975 Prepaid Advertising 2,000 Accounts Payable 17,600 Building 2,190,000 Wages Payable 30,200 Accumulated Depreciation Notes Payable (due in 2023) 1,000,000 (Building) 280,000 Common Shares 1,400,000 Equipment 795,000 Retained Earnings, 12/31/2018 462,375 During 2019 the following transactions occurred: a. Tarkington performed deliveries for customers, all on credit, for $2,256,700. Tarkington also made cash deliveries for $686,838. b. There remains $286,172 of accounts receivable to be collected at December 31, 2019. c. Tarkington purchased advertising of $138,100 during 2019 and debited the amount to prepaid advertising. d. Supplies of $27,200 were purchased on credit and debited to the supplies account. e. Accounts payable at the beginning of 2019 were paid early in 2019. There remains $5,600 of accounts payable unpaid at year end. f. Wages payable at the beginning of 2019 were paid early in 2019. Wages were earned and paid during 2019 in the amount of $666,142. g. During the year, Trish Hurd, a principal stockholder, purchased an automobile costing $42,000 for her personal use. h. One-half year's interest at 6% annual rate was paid on the note payable on July 1, 2019. i. Property taxes were paid on the land and buildings in the amount of $170,000. j. Dividends were declared and paid in the amount of $25,000. Required: 1a. Post the beginning balances and the transactions a-j to the following T-accounts. Note: If a T-accounts isn't needed, leave it blank. 1a. Post the beginning balances and the transactions a-j to the following T-accounts. Note: If a T-accounts isn't needed, leave it blank. Cash Accounts Receivable Bal. $ $ 3 Supplies Prepaid Advertising Adj. Bal. Adi Building (Warehouse) Accum. Depr. (Building) Adj. Bal. Equipment Accum. Depr. (Equipment) Ball Ad Bal. Bal. Land Accounts Payable Bal. Wages Payable Interest Payable Adj. Adi. Income Taxes Payable Notes Payable Common Stock Retained Earnings Bal. Bal. Bal. Dividends Service Revenue Bal C Bal. Wages Expense Interest Expense Adj. Adj. Bal. Bal Property Taxes Expense Supplies Expense Bal. Bal. Depreciation Expense Income Taxes Expense Adj. Adj. Bal. Advertising Expense Adj. C Bal. 1b. Prepare journal entries for transactions a through). If no entry is required, select "No entry required for all accounts and leave associated. Enter amounts in the same order as given in the list of transactions. (Record earned revenue) (Record earned revenue) (Record receipt of cash) (Record prepaid advertising) (Record purchase of supplies on account) (Record payment on account) (Record payment of wages from prior year) (Record payment of wages from prior year) (Record wage expense) (Record purchase of automobile) (Record interest expense) (Record property tax expense) (Record payment of dividends) 2. The following data are available for adjusting entries: Supplies in the amount of $13,685 remained unused at year end. Annual depreciation on the warehouse building is $70,000. Annual depreciation on the warehouse equipment is $145,000. Weces of $60.558 were unrecorded and unpaid at year end. Interest for 6 months at 6% per year on the note is unpaid and unrecorded at year end. Advertising of $14,874 remained unused at the end of 2019. Income taxes of $482,549 related to 2019 are unpaid at year end. Prepare the adjustments using the adjusting entries data, prepare the adjusting journal entries. Dec 31 (Record use of supplies) Dec. 31 - (Record depreciation on building) (Record depreciation on equipment) Dec. 31 (Record wages due to employees) Dec. 31 (Record unpaid interest on note) (Record use of prepaid advertising) (Record income taxes owed)
