Transaction No$.$ Transaction Chapter

A January $1$: Pane purchases inventory on account to make stained glass windows. The contract has terms of $2/10,$ n$/30.$ The goods were purchased under the shipping terms of FOB destination. $6$

Inventory Purchased $$9,750,000$

Shipping Cost $$5,050$

B January $3$: Pane receives rent for the $2$ years from a tenant who rents one of their empty warehouses. $4$

Total Rent Paid $$63,000$

C January $5$: Pane pays for the inventory purchased in transaction A$.6$

D February $12$: Pane purchased a one year insurance policy with coverage beginning on March $1.4$

Insurance Policy $$20,000$

E March $1$: Pane purchases additional inventory on account to make stained glass windows. The goods were purchased under the shipping terms of FOB shipping point. $6$

Inventory Purchased $$12,125,000$

Shipping Cost $$9,000$

F May $31$: Pane sells window panes to customers. Some customers paid in cash, others purchased their goods on account. Pane uses the perpetual method to track their inventory. $6$

Cash Sales $5,367,000$

Sales on account $40,054,000$

Cost of Goods Sold $13,250,000$

G June $1$: Pane pays for the inventory purchased in transaction E$.6$

H July $1$: Pane pays cash for a patent that will allow them to produce a revolutionary new window for boats and other marine vehicles called $"$T$-$Panes". $9$

Cost of Patent $$90,000$

Remaining legal life of patent $($in years$)9$

I July $28$: Pane issued shares of common stock $11$

Number of shares $5,230$

Par Value $$2$

Price Per Share $$124$

J August $6$: Pane purchases land with cash. At the time of purchase, Pane also had to pay for survey fees related to the land. $9$

Cost of Land $$124,000$

Survey Fees $$600$

K November $1$: Pane lends one of their employees $$200,000$ in exchange for a note receivable. The employee is required to pay Pane back for the principal and interest on September $1,2024.8$

Principal $$200,000$

Interest Rate $9\%$

Maturity Date $9/1/2024$

L November $15$: Pane sales additional goods to customers on account. $7,8$

Sales on account $$20,000,000$

Cost of Goods Sold $$6,350,000$

M December $1$: Pane puchases a piece of machinery with cash that will assist in making $"$T$-$Panes" $8$

Cost of Machinery $$890,000$

Installation Fees $$4,250$

Transportation Costs $$1,030$

N December $10$: Pane collects a portion of their accounts receivable $8$

Amount collected $$43,758,000$

O December $18$: Pane sold a piece of their equipment for $$10,000$ in exchange for cash. $9$

Sale Price $$10,000$

Equipment Historical Cost $$55,000$

Accumulated Depreciation for this equipment $$38,000$

P December $31$: Pane paid the IRS their $2023$ income tax.

Income Tax Paid $$2,000,000$

Q The payroll information for the year is shown below. All salaries and wages were previously paid for in cash, however this activity has not been recorded on Pane's books. The payroll information for the year is shown below. All salaries and wages were previously paid for in cash, however this activity has not been recorded on Pane's books.

Number of employees $200$

Employee payment $($daily$)$ $$175$

Days worked in the current year $250$

S On december $31$ Pane was notified that one of their customers filed bankruptcy and cannot pay off their $$3,000.$

On December $31,$ Pane paid cash dividends of $$8,000$ to its shareholders

$1.$ Recognize the revenue earned from the rent paid in transaction B$.$

$2.$ Recognize the expiration of the prepaid insurance policy purchased in transaction D$.$

$3.$ Recognize the interest earned on the note receivable issued in transaction K$.$

$4.$ Record the bad debt expense for the year, assuming uses $3\%$ of accounts $5.$ receivable to estimate their uncollectible accounts

$5.$ Depreciation expense for the year is $2,556,000$

$6.$ Authorization expense for the year is $3,000$

Instructions:

$1.$ prepare the journal entries for transactions A$-$T and record them as journal entries.

$2.$ once you have made journal entries, post them in T$-$accounts.

$3.$ prepare journal entries for adjusting journal entries $1-6.$

$4.$ post the adjusting entries to the correct T$-$accounts