Sample Question: Complex Category Pool Corporation is the world's largest wholesale distributor of swimming pool supplies and equipment & services. It sells these products to swimming pool repair and service businesses like Penny's Pool Service & Supply Inc., swimming pool builders, and retail swimming pool stores. The majority of these customers are small, family-owned businesses like Penny's. Its trial balance for the last year ended December 31, 2019 is presented below: credit Debit $ 560,000 65,000 25,000 125,000 20,000 143,000 2,000 Account Titles Cash and cash equivalents Accounts receivable Supplies Product Inventory Prepaid insurance Equipment Other non-current assets, net Accumulated depreciation Accounts payable Interest payable Rent payable Wages payable Property tax payable Long term notes payable Capital Retained earnings $ 21,000 25,000 7,000 12,000 30,000 500,000 345,000 $ 940,000 940,000 The following transactions occurred during the financial year 2020: a. A retail pool customer pays his outstanding balance of $10,200 to Pool Corporation b. Supplies purchased in Cash amounting $480. c. Pool Corporation purchases Product Inventory in Cash amounting to $3,100. d. Paid wages in cash amounting to $9,000. e. Pool Corporation purchased equipment worth $5,000 and paid immediately. f. Pool Corporation paid $2,400 cash for the premium on a 12th month insurance policy beginning from December 2020. g. Pool Corporation paid $200 towards general repairs in cash. h. Pool Corporation paid $2,800 cash towards Utilities. on November 1, 2020. recorded on December 31, h. Pool Corporation paid $2,800 cash towards Utilities 1. Pool Corporation paid $160 towards transportation for one of the equipment as per the sale agreement 1. Pool Corporation purchased Product Inventory for $22,000 Cash k. Pool Corporation owed $1,000 wages to the office receptionist and three assistants for working the last two days in December On October 1, 2020, Pool Corporation received $24,000 from customers who prepaid pool cleaning service for one year beginning m. Pool Corporation received a $560 utility bill for December utility usage. It will be paid in January 2021, n. Pool Corporation borrowed $30,000 from a local bank on May 1, 2020, signing a note with a 6 percent interest rate. The note and interest are due on May 1, 2021. o. On December 31, 2020, Pool Corporation cleaned and winterized a customer's pool for $12,600, but the service was not yet p. On August 1, 2020, Pool Corporation purchased a two-year Insurance policy for $5,400, with coverage beginning on that date. 9. During 2020, Pool Corporation purchased supplies costing $23,000 from various suppliers for cash. 1. Pool Corporation estimated that depreciation on its buildings and equipment was $8,300 for the year, s. At December 31, 2020, $1.400 of interest on investments was earned that will be received in 2021 t. Rent for December due to be paid in January 2020 of $2,100. u. Sold $57,000 of goods and received the amount on the same day, v. Record the expired insurance purchased (trans. f) for the month of December w. Sales worth $25,000 made to Penny's Pool Service & Supply Inc. on Credit . X. Pool Corporation received utilities bill for $520 for December. Paid in cash when received. y. Property tax paid $10,300 during the year. 2. Received partial payment from Penny's Pool Service & Supply Inc amounting to $12,500 for the purchase made this year, (tras. "w") al. Pool Corporation purchased equipment worth $5,000 on credit basis. b2. Pool Corporation received the remaining balance amount due towards the recent sale made to Penny's Pool Service & Supply Inc. c3. Paid for the equipment purchased. (tran. A1) 04. On December 31, 2020, Pool Corporation had $24,000 of pool cleaning supplies on hand. Record the necessary adjusting entry. e5. Property tax due and payable worth $11,000. e6. Recognize revenue earned (transaction L) e7. Record interest accrued on bank loan (Transaction N). e8. Record the adjusting entry to record expired insurance (Transaction P). (trans "w") . 1. Post the required entries. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet .... 10 11 12 13 14 15 34 *** Record the $12,600 receivable for cleaning and winterizing a pool on December 31, 2020 not yet recorded. Note: Enter debits before credits Debit General Journal Credit Transaction 0 View general journal Record entry Clear entry