Refer to;
Dylex Corporation's May journal entries have been posted to the general ledger for you as shown below. This is similar to how an accounting software package posts automatically.
Part 4 [50 points] a) The following bank statement was received. Prepare a bank reconciliation for May: Bank Statement To: Dylex Corporation May 31, 2015 Cheques/Charges/Debits Deposits/Credits Balance 815,862 #2699 01/May 5,600 810,262 04/May 35,150 845,412 NSF Cheque 06/May 27,298 818,114 07/May 402,192 1,220,306 #2701 15/May 48,000 15/May 1,755 1,174,061 18/May 247,500 1,421,561 #2702 19/May 10,800 1,410,761 #2703 21/May 45,100 1,365,661 23/May 1,587,600 2,953,261 #2705 25/May 31,000 2,922,261 #2706 26/May 619,360 2,302,901 #2707 31/May 48,000 2,254,901 Service Charge 31/May 1,300 2,253,601 Additional Information: The NSF cheque was received in April from Courtland Corp. for a sale dated April 15. Dylex Corporation Bank Reconciliation May 31, 2015 Book balance Add: 714,949 Bank statement balance Add: Deduct: Deduct: Outstanding cheques: Adjusted bank balance Adjusted book balance b) Prepare the appropriate adjusting entries on May 31, 2015. Hint: Some additional information is provided below but where else might you look to find details relevant to preparing the adjusting entries? It is estimated that utilities used during May totalled $24,800. Actual count of ending merchandise inventory on May 31, 2015 was $1,748,141. Management estimates uncollectible accounts receivable based on the following rates of uncollectibility applied to outstanding accounts: Not yet due (2%), 1-30 days past due (9%), 31-60 days past due (18%), Greater than 61 days past due (60%). Since this is an estimate please round your final answer to the nearest whole dollar. Income taxes are estimated to be $271,800. General Journal Account/Explanation Page Gj1 F Debit Credit General Joumal Account/Explanation Page GJ2 F Debit Credit Date Date + 1 + + Part 3 [45 points] a) Prepare the unadjusted trial balance at May 31, 2015. NOTE: Do not include 'O' balance accounts. Dylex Corporation Unadjusted Trial Balance May 31, 2015 Debit Credit Cash 714,949 Accounts receivable 1,036,800 Allowance for doubtful accounts 175,644 Notes receivable 91,633 Merchandise inventory. (1,879,721 Prepaid advertising. 27,000 Office furniture 10,800 Accounts payable 399,000 Common shares 85,250 Retained earnings 1,703,245 Cash dividends declared 45,100 Interest earned 194 Sales 3,067,200 Sales discounts 40,608 Cost of goods sold. 1,130,639 Office salaries expense 22,000 Sales salaries expense. 74,000 Rent expense, office space. 3,360 Rent expense, selling space. 2,240 Loss on sale of property, plant and equipment assets 395 Totals 5,254,889 5,254,889 Dylex Corporation's May journal entries have been posted to the general ledger for you as shown below. This is similar to how an accounting software package posts automatically. F Debit Cash Date Explanation 30/Apr Opening balance 1/May Paid cash for rent 4/May Sold all store equipment for cash 7/May Received customer payment 10/May Issued cheque for purchase 15/May Collection of interest 15/May Paid cash for salaries 18/May Issued shares 19/May Paid invoice for office furniture 21/May Declared and paid dividends. 23/May Received customer payment 23/May Paid invoice for merchandise 25/May Paid utility bill. 26/May Paid invoice for merchandise 31/May Paid cash for salaries GJ1 GJ1 35,150 GJ1 402,192 GJ1 GJ1 1,755 GJ1 GJ2 24,750 GJ2 GJ2 GJ21,587,600 GJ2 GJ2 GJ2 GJ2 Account No. 101 Credit Balance 815,862 5,600 810,262 845,412 1.247,604 712,500 535, 104 536,859 48,000 488,859 513,609 10,800 502,809 45,100 457,709 2,045,309 632,000 1,413,309 31,000 1,382,309 619,360 762,949 48,000 714,949 F F Debit Accounts Receivable Date Explanation 30/Apr Opening balance. 2/May Weber Inc. : Sold merchandise on credit 7/May Weber Inc. : Received customer payment 14/May Weber Inc. : Sold merchandise on credit 23/May Weber Inc. : Received customer payment 25/May Gulf Corp. : Sold merchandise on credit 28/May Star Inc. : Wrote off uncollectible account GJ1 410,400 GJ1 GJ11,620,000 GJ2 GJ2 1,036,800 GJ2 Account No. 106 Credit Balance 209,100 619,500 410,400 209,100 1,829,100 1,620,000 209,100 1,245,900 209,100 1,036,800 F F Debit Credit Allowance for Doubtful Accounts Date Explanation 30/Apr Opening balance 28/May Wrote off uncollectible account Account No. 107 Balance 33,456 -175,644 GJ2 209,100 Interest Receivable Explanation F Debit Credit Date 30/Apr Opening balance 15/May Collection of interest Account No. 109 Balance 194 0 GJ1 194 Notes Receivable Explanation F Debit Credit Date 30/Apr Opening balance 15/May Collection of interest Account No. 111 Balance 93,000 91,633 GJ1 1,367 F Debit Merchandise Inventory Date Explanation 30/Apr Opening balance 2/May Sold merchandise on credit 12/May Purchased merchandise 14/May Sold merchandise on credit 20/May Purchased merchandise on credit 25/May Sold merchandise on credit 26/May Paid invoice for merchandise 27/May Purchased merchandise inventory on credit GJ1 GJ1 632,000 GJ1 GJ2 632,000 GJ2 GJ2 GJ2 399,000 Account No. 119 Credit Balance 1,360,000 152,000 1,208,000 1,840,000 597,375 1,242,625 1,874,625 381,264 1,493,361 12,640 1,480,721 1,879,721 Prepaid Advertising Explanation F Debit Credit Date 30/Apr Opening balance Account No. 130 Balance 27,000 Credit Office Furniture Date Explanation 10/May Purchased furniture on credit 12/May Received a credit memorandum F GJ1 GJ1 Debit 13,500 Account No. 157 Balance 13,500 10,800 2,700 F Debit Store Equipment Date Explanation 30/Apr Opening balance 4/May Sold all store equipment for cash. Account No. 165 Credit Balance 155,900 155,900 0 GJ1 F Debit Credit Accumulated Depreciation, Store Equipment Date Explanation 30/Apr Opening balance 4/May Sold all store equipment for cash.. Account No. 166 Balance 120,355 0 GJ1 120,355 Accounts Payable Date Explanation F Debit 30/Apr Opening balance 10/May Allarco Inc. : Purchased furniture on credit GJ1 10/May Northstar Corp. : Issued cheque for purchase GJ1 712,500 12/May Allarco Inc. : Received a credit memorandum GJ1 2,700 12/May Holden Corp. : Purchased merchandise. GJ1 19/May Allarco Inc. : Paid invoice for office furniture GJ2 10,800 20/May Northstar Corp. : Purchased merchandise on credit GJ2 23/May Holden Corp. : Paid invoice for merchandise GJ2 632,000 26/May Northstar Corp. : Paid invoice for merchandise GJ2 632,000 27/May Stake Technology Inc. : Purchased merchandise inventory on credit Gj2 Account No. 201 Credit Balance 712,500 13,500 726,000 13,500 10,800 632,000 642,800 632,000 632,000 1,264,000 632,000 0 399,000 399,000 Utilities Payable Explanation F Debit Credit Date 30/Apr Opening balance 25/May Paid utility bill. Account No. 212 Balance 31,000 0 GJ2 31,000 Common Shares Explanation F Debit Date 30/Apr Opening balance 18/May Issued shares Account No. 307 Credit Balance 60,500 24,750 85,250 GJ2 Retained Earnings Explanation Debit Credit Date 30/Apr Opening balance Account No. 318 Balance 1,703,245 Cash Dividends Declared Date Explanation 21/May Declared and paid dividends Credit F Debit GJ2 45,100 Account No. 319 Balance 45, 100 Interest Earned Explanation Debit Date 15/May Collection of interest F GJ1 Credit 194 Account No. 409 Balance 194 Debit Sales Date Explanation 2/May Sold merchandise on credit. 14/May Sold merchandise on credit 25/May Sold merchandise on credit F GJ1 GJ1 GJ2 Account No. 413 Credit Balance 410,400 410,400 1,620,000 2,030,400 1,036,800 3,067,200 Credit Sales Discounts Date Explanation 7/May Received customer payment 23/May Received customer payment F GJ1 GJ2 Debit 8,208 32,400 Account No. 415 Balance 8,208 40,608 Credit Cost Of Goods Sold Date Explanation 2/May Sold merchandise on credit. 14/May Sold merchandise on credit 25/May Sold merchandise on credit F Debit GJ1 152,000 GJ1 597,375 GJ2 381,264 Account No. 502 Balance 152,000 749,375 1,130,639 Office Salaries Expense Explanation F Credit Date 15/May Paid cash for salaries, 31/May Paid cash for salaries Account No. 620 Balance 11,000 22,000 Debit 11,000 11,000 GJ1 GJ2 Sales Salaries Expense Explanation Credit Date 15/May Paid cash for salaries. 31/May Paid cash for salaries, F GJ1 GJ2 Debit 37,000 37,000 Account No. 621 Balance 37,000 74,000 Rent expense, office space Explanation Credit Date 1/May Paid cash for rent F GJ1 Debit 3,360 Account No. 641 Balance 3,360 Rent expense, selling space Explanation Credit Date 1/May Paid cash for rent. F GJ1 Debit 2,240 Account No. 642 Balance 2,240 Loss on Sale of Property, Plant and Equipment Assets Date Explanation 4/May Sold all store equipment for cash F GJ1 Debit 395 Account No. 8101 Credit Balance 395 Part 4 [50 points] a) The following bank statement was received. Prepare a bank reconciliation for May: Bank Statement To: Dylex Corporation May 31, 2015 Cheques/Charges/Debits Deposits/Credits Balance 815,862 #2699 01/May 5,600 810,262 04/May 35,150 845,412 NSF Cheque 06/May 27,298 818,114 07/May 402,192 1,220,306 #2701 15/May 48,000 15/May 1,755 1,174,061 18/May 247,500 1,421,561 #2702 19/May 10,800 1,410,761 #2703 21/May 45,100 1,365,661 23/May 1,587,600 2,953,261 #2705 25/May 31,000 2,922,261 #2706 26/May 619,360 2,302,901 #2707 31/May 48,000 2,254,901 Service Charge 31/May 1,300 2,253,601 Additional Information: The NSF cheque was received in April from Courtland Corp. for a sale dated April 15. Dylex Corporation Bank Reconciliation May 31, 2015 Book balance Add: 714,949 Bank statement balance Add: Deduct: Deduct: Outstanding cheques: Adjusted bank balance Adjusted book balance b) Prepare the appropriate adjusting entries on May 31, 2015. Hint: Some additional information is provided below but where else might you look to find details relevant to preparing the adjusting entries? It is estimated that utilities used during May totalled $24,800. Actual count of ending merchandise inventory on May 31, 2015 was $1,748,141. Management estimates uncollectible accounts receivable based on the following rates of uncollectibility applied to outstanding accounts: Not yet due (2%), 1-30 days past due (9%), 31-60 days past due (18%), Greater than 61 days past due (60%). Since this is an estimate please round your final answer to the nearest whole dollar. Income taxes are estimated to be $271,800. General Journal Account/Explanation Page Gj1 F Debit Credit General Joumal Account/Explanation Page GJ2 F Debit Credit Date Date + 1 + + Part 3 [45 points] a) Prepare the unadjusted trial balance at May 31, 2015. NOTE: Do not include 'O' balance accounts. Dylex Corporation Unadjusted Trial Balance May 31, 2015 Debit Credit Cash 714,949 Accounts receivable 1,036,800 Allowance for doubtful accounts 175,644 Notes receivable 91,633 Merchandise inventory. (1,879,721 Prepaid advertising. 27,000 Office furniture 10,800 Accounts payable 399,000 Common shares 85,250 Retained earnings 1,703,245 Cash dividends declared 45,100 Interest earned 194 Sales 3,067,200 Sales discounts 40,608 Cost of goods sold. 1,130,639 Office salaries expense 22,000 Sales salaries expense. 74,000 Rent expense, office space. 3,360 Rent expense, selling space. 2,240 Loss on sale of property, plant and equipment assets 395 Totals 5,254,889 5,254,889 Dylex Corporation's May journal entries have been posted to the general ledger for you as shown below. This is similar to how an accounting software package posts automatically. F Debit Cash Date Explanation 30/Apr Opening balance 1/May Paid cash for rent 4/May Sold all store equipment for cash 7/May Received customer payment 10/May Issued cheque for purchase 15/May Collection of interest 15/May Paid cash for salaries 18/May Issued shares 19/May Paid invoice for office furniture 21/May Declared and paid dividends. 23/May Received customer payment 23/May Paid invoice for merchandise 25/May Paid utility bill. 26/May Paid invoice for merchandise 31/May Paid cash for salaries GJ1 GJ1 35,150 GJ1 402,192 GJ1 GJ1 1,755 GJ1 GJ2 24,750 GJ2 GJ2 GJ21,587,600 GJ2 GJ2 GJ2 GJ2 Account No. 101 Credit Balance 815,862 5,600 810,262 845,412 1.247,604 712,500 535, 104 536,859 48,000 488,859 513,609 10,800 502,809 45,100 457,709 2,045,309 632,000 1,413,309 31,000 1,382,309 619,360 762,949 48,000 714,949 F F Debit Accounts Receivable Date Explanation 30/Apr Opening balance. 2/May Weber Inc. : Sold merchandise on credit 7/May Weber Inc. : Received customer payment 14/May Weber Inc. : Sold merchandise on credit 23/May Weber Inc. : Received customer payment 25/May Gulf Corp. : Sold merchandise on credit 28/May Star Inc. : Wrote off uncollectible account GJ1 410,400 GJ1 GJ11,620,000 GJ2 GJ2 1,036,800 GJ2 Account No. 106 Credit Balance 209,100 619,500 410,400 209,100 1,829,100 1,620,000 209,100 1,245,900 209,100 1,036,800 F F Debit Credit Allowance for Doubtful Accounts Date Explanation 30/Apr Opening balance 28/May Wrote off uncollectible account Account No. 107 Balance 33,456 -175,644 GJ2 209,100 Interest Receivable Explanation F Debit Credit Date 30/Apr Opening balance 15/May Collection of interest Account No. 109 Balance 194 0 GJ1 194 Notes Receivable Explanation F Debit Credit Date 30/Apr Opening balance 15/May Collection of interest Account No. 111 Balance 93,000 91,633 GJ1 1,367 F Debit Merchandise Inventory Date Explanation 30/Apr Opening balance 2/May Sold merchandise on credit 12/May Purchased merchandise 14/May Sold merchandise on credit 20/May Purchased merchandise on credit 25/May Sold merchandise on credit 26/May Paid invoice for merchandise 27/May Purchased merchandise inventory on credit GJ1 GJ1 632,000 GJ1 GJ2 632,000 GJ2 GJ2 GJ2 399,000 Account No. 119 Credit Balance 1,360,000 152,000 1,208,000 1,840,000 597,375 1,242,625 1,874,625 381,264 1,493,361 12,640 1,480,721 1,879,721 Prepaid Advertising Explanation F Debit Credit Date 30/Apr Opening balance Account No. 130 Balance 27,000 Credit Office Furniture Date Explanation 10/May Purchased furniture on credit 12/May Received a credit memorandum F GJ1 GJ1 Debit 13,500 Account No. 157 Balance 13,500 10,800 2,700 F Debit Store Equipment Date Explanation 30/Apr Opening balance 4/May Sold all store equipment for cash. Account No. 165 Credit Balance 155,900 155,900 0 GJ1 F Debit Credit Accumulated Depreciation, Store Equipment Date Explanation 30/Apr Opening balance 4/May Sold all store equipment for cash.. Account No. 166 Balance 120,355 0 GJ1 120,355 Accounts Payable Date Explanation F Debit 30/Apr Opening balance 10/May Allarco Inc. : Purchased furniture on credit GJ1 10/May Northstar Corp. : Issued cheque for purchase GJ1 712,500 12/May Allarco Inc. : Received a credit memorandum GJ1 2,700 12/May Holden Corp. : Purchased merchandise. GJ1 19/May Allarco Inc. : Paid invoice for office furniture GJ2 10,800 20/May Northstar Corp. : Purchased merchandise on credit GJ2 23/May Holden Corp. : Paid invoice for merchandise GJ2 632,000 26/May Northstar Corp. : Paid invoice for merchandise GJ2 632,000 27/May Stake Technology Inc. : Purchased merchandise inventory on credit Gj2 Account No. 201 Credit Balance 712,500 13,500 726,000 13,500 10,800 632,000 642,800 632,000 632,000 1,264,000 632,000 0 399,000 399,000 Utilities Payable Explanation F Debit Credit Date 30/Apr Opening balance 25/May Paid utility bill. Account No. 212 Balance 31,000 0 GJ2 31,000 Common Shares Explanation F Debit Date 30/Apr Opening balance 18/May Issued shares Account No. 307 Credit Balance 60,500 24,750 85,250 GJ2 Retained Earnings Explanation Debit Credit Date 30/Apr Opening balance Account No. 318 Balance 1,703,245 Cash Dividends Declared Date Explanation 21/May Declared and paid dividends Credit F Debit GJ2 45,100 Account No. 319 Balance 45, 100 Interest Earned Explanation Debit Date 15/May Collection of interest F GJ1 Credit 194 Account No. 409 Balance 194 Debit Sales Date Explanation 2/May Sold merchandise on credit. 14/May Sold merchandise on credit 25/May Sold merchandise on credit F GJ1 GJ1 GJ2 Account No. 413 Credit Balance 410,400 410,400 1,620,000 2,030,400 1,036,800 3,067,200 Credit Sales Discounts Date Explanation 7/May Received customer payment 23/May Received customer payment F GJ1 GJ2 Debit 8,208 32,400 Account No. 415 Balance 8,208 40,608 Credit Cost Of Goods Sold Date Explanation 2/May Sold merchandise on credit. 14/May Sold merchandise on credit 25/May Sold merchandise on credit F Debit GJ1 152,000 GJ1 597,375 GJ2 381,264 Account No. 502 Balance 152,000 749,375 1,130,639 Office Salaries Expense Explanation F Credit Date 15/May Paid cash for salaries, 31/May Paid cash for salaries Account No. 620 Balance 11,000 22,000 Debit 11,000 11,000 GJ1 GJ2 Sales Salaries Expense Explanation Credit Date 15/May Paid cash for salaries. 31/May Paid cash for salaries, F GJ1 GJ2 Debit 37,000 37,000 Account No. 621 Balance 37,000 74,000 Rent expense, office space Explanation Credit Date 1/May Paid cash for rent F GJ1 Debit 3,360 Account No. 641 Balance 3,360 Rent expense, selling space Explanation Credit Date 1/May Paid cash for rent. F GJ1 Debit 2,240 Account No. 642 Balance 2,240 Loss on Sale of Property, Plant and Equipment Assets Date Explanation 4/May Sold all store equipment for cash F GJ1 Debit 395 Account No. 8101 Credit Balance 395
