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[ The following information applies to the questions displayed below. ] Brothers Harry and Herman Hausyerday began operations of their machine shop (H & H

[The following information applies to the questions displayed below.]

Brothers Harry and Herman Hausyerday began operations of their machine shop (H & H Tool, Inc.) on January 1, 2013. The annual reporting period ends December 31. The trial balance on January 1, 2015, follows (the amounts are rounded to thousands of dollars to simplify):

Account Titles Debit Credit
Cash $ 2
Accounts Receivable 6
Supplies 13
Land 0
Equipment 64
Accumulated Depreciation $ 5
Software 18
Accumulated Amortization 4
Accounts Payable 4
Notes Payable (short-term) 0
Salaries and Wages Payable 0
Interest Payable 0
Income Tax Payable 0
Common Stock 81
Retained Earnings 9
Service Revenue 0
Salaries and Wages Expense 0
Depreciation Expense 0
Amortization Expense 0
Income Tax Expense 0
Interest Expense 0
Supplies Expense 0
Totals $ 103 $ 103

Transactions during 2015 (summarized in thousands of dollars) follow:
1. Borrowed $11 cash on a six-month note payable dated March 1, 2015.
2. Purchased land for future building site; paid cash, $8.
3. Earned revenues for 2015, $168, including $44 on credit and $124 collected in cash.
4. Issued additional shares of stock for $4.
5. Recognized salaries and wages expense for 2015, $89 paid in cash.
6. Collected accounts receivable, $28.
7. Purchased software, $11 cash.
8. Paid accounts payable, $12.
9. Purchased supplies on account for future use, $19.
10. Signed a $20 service contract to start February 1, 2016.
Data for adjusting journal entries:
11. Unrecorded amortization for the year on software, $4.
12. Supplies counted on December 31, 2015, $12.
13. Depreciation for the year on the equipment, $5.
14. Accrued interest of $1 on notes payable.
15. Salaries and wages earned but not yet paid or recorded, $13.
16. Income tax for the year was $7. It will be paid in 2016.

Required:
2.

Record journal entries for transactions (1) through (10). (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Enter your answers in thousands of dollars.)

3, 5 and 8.

Set up T-accounts for the accounts on the trial balance. Enter beginning balances and post the transactions 1-10, adjusting entries 11-16, and closing entry. (Enter your answers in thousands of dollars.)

3.

Post the journal entries from requirement 2 to T-accounts and prepare an unadjusted trial balance.(Enter your answers in thousands of dollars.)

4.

Record the adjusting journal entries (11) through (16). (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Enter your answers in thousands of dollars.)

5.

Post the adjusting entries from requirement 4 and prepare an adjusted trial balance. (Enter your answers in thousands of dollars.)

6.a

Prepare an income statement.

6.b

Prepare a statement of retained earnings.

6.c

Prepare balance sheet. (Amounts to be deducted should be indicated by a minus sign.)

7.

Prepare the closing journal entry. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Enter your answers in thousands of dollars.)

8.

Post the closing entry from requirement 7 and prepare a post-closing trial balance. (Enter your answers in thousands of dollars.)

9-a.

How much net income did H & H Tool, Inc., generate during 2015? What was its net profit margin?(Enter "Net Income" in thousands of dollars. Round "Net Profit Profit" to 2 decimal places.)

9-b. Is the company financed primarily by liabilities or stockholders equity?
A. Liabilities
B. Stockholders' Equity

9-c.

What is its current ratio? (Enter your answers in thousands of dollars.)

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