QUESTION 8(20 marks - 4 marks each)

Aloha Painting Company has reached the end of its first fiscal year, November 30, 2020.

Prepare any ADJUSTING JOURNAL ENTRIES required for Aloha Painting Co. at November 30, 2020 for a) to e) below.Assume that all original transaction entries were recorded and posted correctly.Omit explanations and do not prepare the original journal entries.

a)On November 4, 2020, Aloha Painting received a $6,000 advance payment from Charlie Client as a deposit for a painting job to be done in November, December and January.This receipt had been credited to Unearned Painting Revenue.At November 30, 2020 the company estimated they had earned 30% of the advance payment.

b)Aloha Painting has an agreement with Cassie Customer to provide painting services for October, November and December for $1,600 per month.The required work was done for October and November.Cassie has not yet been billed, but will be billed when the job is complete, i.e. at end of December.

c)On February 1, 2020, Aloha Painting purchased machinery for $42,000.It will be used for eight years, and its estimated residual value is $4,000.

d)On February 1, 2020, Aloha Painting purchased a one year insurance policy and debited Prepaid Insurance.This policy covers the fiscal year from February 1, 2020 to January 31, 2021 and had cost $1,440.

e)On March 1, 2020, Aloha Painting agreed to allow another company (DC Painting) to store equipment and paint in Aloha's facility for $200 per month.(Aloha credits the Storage Fees account whenever such revenue is earned).A six month prepayment was paid upon signing of the agreement, but DC will not have to make the next payment until the first anniversary date of the agreement, at which time they will pay any outstanding storage fees to bring their account up to date.

QN 2

On November 30 of the current year, the bank statement, showed a balance of $3,338.20 in the Halekulani Hotel bank account. The general ledger showed a debit balance of $4,195.20 at November 30.The following information was also determined:

a)A customer's cheque for $970 marked NSF was returned with the bank statement and was deducted from the bank account. The bank also deducted $25.00 to process the NSF cheque

b)The November 30 cash receipts of $1,984.05 were placed in the bank's night depository after banking hours November 30 but this did not appear on the bank statement.

c)$33.05 in cheque processing fees were deducted from the bank statement by the bank.

d)Cheques totaling $2,110 which were written by the Halekulani Hotel during November were not returned with the bank statement and not yet deducted by the bank.

e)The bank paid the Halekulani Hotel $45.10 in interest for maintaining a minimum balance in their account for the month

REQUIRED:

a)Prepare a bank reconciliation, in good form, for the Halekulani Hotel.