TAKEHOME TESTS 1 2 AND 3 nces Mailings Review View Aa - A AaBbCcDdE AaBbCcDdEe AaBbCcDdEe AaBbCcDc AaBbCCD . A . E Heading 5 Normal No Spacing Heading 1 Heading TAKENUIVIE TEST 2-DUE UN MUNJDAT Str Required: Make necessary journal entries including the necessary adjusting entries, post them to their respective general ledger accounts and prepare only an adjusted trial balance. 1. Using the following information, complete the accounting cycle. Jan 1, 2010 Sold Common Stock to raise capital in the amount of $800,000. Jan 1 Purchased Factory machinery for $50,000. The machinery has a life of 10 years, residual value of $10,000, and the company uses double declining balance method of depreciation. Jan 1 Purchased Office Supplies for $10,000 for cash Jan 1 Purchased Office Building for $400,000, making a down payment of $200,000 and giving a promissory note to be paid at once at the end of 5 years. The market interest rate at the time of the purchase is 8%. The office building has a life of 20 years, salvage value of $50,000, and the company uses straight line method of depreciation. Jan 5 Purchased Materials from William Martin for $100,000, term 3/10, EOM, FOB shipping point. The transportation incurred and paid is $2,000. Jan 6 Requisitioned for $70,000 direct materials which were put into production process. Jan 6 Requisitioned for $15,000 Indirect materials which were put into production process. an 7 Returned $5,000 of the materials to William Martin for defectiveness. Jan 10 Paid William Martin the amount due. Jan 10 Paid direct labor cost of $15,000. Jan 15 Paid indirect labor cost of $18,000. Jan 12 Paid other factory overhead of $45,000. Jan 31 Make necessary entries for depreciation adjustments for both machinery as well as office building Additional Information: Applied 90% of the actual factory overhead to the production process. The over or under-applied overhead is considered immaterial and this information should be considered in determining how the over-or unde pplied overhead would be disposed off. Jan 31 Paid selling expenses of $6,000 and administrative expenses of $8,000. Jan 31. The unused office supplies is $2,000 and the work in process at the end of the period is $6,000. Jan 31. Sold 60% of the goods available for sale at 200% of their cost for cash. (United States) E MacBook Pro B I U A IE