Transaction recording and reporting During December, the following events occur. You will need to evaluate them and determine which require an entry in the GENERAL JOURNAL and ensure that they properly carry through to the UNADJUSTED TRIAL BALANCE. Date Description of Events Dec. 1 REC buys the van for a price of $14,000. REC will pay $1,040 in cash and finance the rest with an auto loan. Make sure your amortization schedule is complete as you will need it to make payments on this loan. 1 REC pays cash for December rent of $500. REC sends the van to be modified for use. Car Customizers charges $4,000 for the work, payable in 30 days. The van is ready in four days. 3 Rydal Electronics spends $250 cash on advertising for its expanded business options. REC has the opportunity to earn $2,500 for an installation for Danny Acadia. However, the he will only agree to the installation on credit with terms of 2/10, n/30. If you recommended in Part 2 that REC not take service revenue on account, do not include this sale. If you recommended in part 2 that REC not allow sales discounts or your recommended terms are less than the community center wants, do not record this sale. 6 REC buys additional repair supplies for $175 in cash. 8 REC sells two audio units, for $750 each, to Andre Singer. This is a cash sale. You must record the inventory component of the transaction as well as the sale. Use the inventory cost method you recommended to Ron in part 2. Update the Inventory Tracking worksheet as well. 9 REC purchases another two audio units from Heath Kit at $530 each. The terms are 2/10, n/30. 10 REC pays the cell phone bill from November. 14 Danny Acadia pays the amount due for the December 5 installation within the discount period. If you did not record the sale on December 5, skip this entry. 15 REC needs to record the first semi-monthly payroll using the accounts and amounts calculated on the payroll register. REC will not pay Ron until the 20th. Remember to include the employer taxes in your entry. 17 REC pays Heath Kit for the audio units purchased on December 9 within the discount period. 18 REC sells two more audio units to Mark Pool for $750 each. The terms those you recommended to Ron in part 2. If you recommended that REC not take sales revenue on account, do not include this sale. You must record the inventory component of the transaction as well as the sale. Use the inventory cost method you recommended to Ron. Update the Inventory Tracking worksheet as well. 20 REC pays Ron for the first semi-monthly payroll. 23 REC buys more office supplies for $85 cash. 27 REC performs an installation service for Warren Grey. He pays the $1,500 cash at completion. 28 Ron receives his cell phone bill for December will a total due of $150. The bill is due January 15. 30 REC makes the first payment on the auto loan based on the financing option you recommended. Use the Loan Amortization worksheet to determine the total payment, interest and principal amounts. 31 REC needs to record the second semi-monthly payroll using the accounts and amounts calculated on the payroll register. REC will not pay Ron until the 5th of next month. Remember to include the employer taxes in your entry. 31 Ron decides to have REC pay a dividend to the owner of $500. Transactions After the Period LECTRONICS COMPANY At the end of December, you need to talk with Ron about activities that have taken place at REC but not yet recorded. Ron provides you with the following information: Transactions After the Period At the end of December, you need to talk with Ron about activities that have taken place at REC but not yet recorded. Ron provides you with the following information: RYDAL ELECTRONICS 1. A review of office supplies indicates that there is $130 worth of supplies remaining. A review of repair supplies indicates that $190 worth of supplies remain. Ron plans to use the cell phone for two years. As such, it should be recorded as an asset and depreciated equally over 24 months. Ron estimates that the installation equipment should last for four years. As such, it should be recorded as an asset and depreciated in equal amounts over 48 months. The additional installation equipment will also have an expected useful life of four years and should be depreciated equally over 48 months. 6. The website has been in use all month. As such, it will need to be amortized equally over the 36 months of its expected useful life. The van will need to be depreciated over its useful life. Determine the depreciation amount based upon the method and rates you recommended to Ron. Ron drove the van $1,100 miles in December. The insurance policy purchased in October covers the twelve month of November through next October. As this is now the end of December, one month's insurance must recorded. Determine the Allowance for Uncollectible Accounts based upon the method and rates you recommended to Ron. The note payable to the bank is not due; however, one month's worth of interest should be recorded. The auto loan will involve principal payments each month. Therefore, part of the balance due should be classified as a current liability. Adjust the accounts for the amount of principal to be paid in the next twelve months. Use the Loan Amortization worksheet to assist you. 11. Make all necessary adjusting entries in the ADJUSTING JOURNAL and ensure that they properly carry through to the ADJUSTED TRIAL BALANCE. Finally, REC pays income tax quarterly. The rate is 30% of income before taxes. You will need to calculate the amount due for December income and record the related liability. Use the ADJUSTING JOURNAL for this entry as well. Transaction recording and reporting During December, the following events occur. You will need to evaluate them and determine which require an entry in the GENERAL JOURNAL and ensure that they properly carry through to the UNADJUSTED TRIAL BALANCE. Date Description of Events Dec. 1 REC buys the van for a price of $14,000. REC will pay $1,040 in cash and finance the rest with an auto loan. Make sure your amortization schedule is complete as you will need it to make payments on this loan. 1 REC pays cash for December rent of $500. REC sends the van to be modified for use. Car Customizers charges $4,000 for the work, payable in 30 days. The van is ready in four days. 3 Rydal Electronics spends $250 cash on advertising for its expanded business options. REC has the opportunity to earn $2,500 for an installation for Danny Acadia. However, the he will only agree to the installation on credit with terms of 2/10, n/30. If you recommended in Part 2 that REC not take service revenue on account, do not include this sale. If you recommended in part 2 that REC not allow sales discounts or your recommended terms are less than the community center wants, do not record this sale. 6 REC buys additional repair supplies for $175 in cash. 8 REC sells two audio units, for $750 each, to Andre Singer. This is a cash sale. You must record the inventory component of the transaction as well as the sale. Use the inventory cost method you recommended to Ron in part 2. Update the Inventory Tracking worksheet as well. 9 REC purchases another two audio units from Heath Kit at $530 each. The terms are 2/10, n/30. 10 REC pays the cell phone bill from November. 14 Danny Acadia pays the amount due for the December 5 installation within the discount period. If you did not record the sale on December 5, skip this entry. 15 REC needs to record the first semi-monthly payroll using the accounts and amounts calculated on the payroll register. REC will not pay Ron until the 20th. Remember to include the employer taxes in your entry. 17 REC pays Heath Kit for the audio units purchased on December 9 within the discount period. 18 REC sells two more audio units to Mark Pool for $750 each. The terms those you recommended to Ron in part 2. If you recommended that REC not take sales revenue on account, do not include this sale. You must record the inventory component of the transaction as well as the sale. Use the inventory cost method you recommended to Ron. Update the Inventory Tracking worksheet as well. 20 REC pays Ron for the first semi-monthly payroll. 23 REC buys more office supplies for $85 cash. 27 REC performs an installation service for Warren Grey. He pays the $1,500 cash at completion. 28 Ron receives his cell phone bill for December will a total due of $150. The bill is due January 15. 30 REC makes the first payment on the auto loan based on the financing option you recommended. Use the Loan Amortization worksheet to determine the total payment, interest and principal amounts. 31 REC needs to record the second semi-monthly payroll using the accounts and amounts calculated on the payroll register. REC will not pay Ron until the 5th of next month. Remember to include the employer taxes in your entry. 31 Ron decides to have REC pay a dividend to the owner of $500. Transactions After the Period LECTRONICS COMPANY At the end of December, you need to talk with Ron about activities that have taken place at REC but not yet recorded. Ron provides you with the following information: Transactions After the Period At the end of December, you need to talk with Ron about activities that have taken place at REC but not yet recorded. Ron provides you with the following information: RYDAL ELECTRONICS 1. A review of office supplies indicates that there is $130 worth of supplies remaining. A review of repair supplies indicates that $190 worth of supplies remain. Ron plans to use the cell phone for two years. As such, it should be recorded as an asset and depreciated equally over 24 months. Ron estimates that the installation equipment should last for four years. As such, it should be recorded as an asset and depreciated in equal amounts over 48 months. The additional installation equipment will also have an expected useful life of four years and should be depreciated equally over 48 months. 6. The website has been in use all month. As such, it will need to be amortized equally over the 36 months of its expected useful life. The van will need to be depreciated over its useful life. Determine the depreciation amount based upon the method and rates you recommended to Ron. Ron drove the van $1,100 miles in December. The insurance policy purchased in October covers the twelve month of November through next October. As this is now the end of December, one month's insurance must recorded. Determine the Allowance for Uncollectible Accounts based upon the method and rates you recommended to Ron. The note payable to the bank is not due; however, one month's worth of interest should be recorded. The auto loan will involve principal payments each month. Therefore, part of the balance due should be classified as a current liability. Adjust the accounts for the amount of principal to be paid in the next twelve months. Use the Loan Amortization worksheet to assist you. 11. Make all necessary adjusting entries in the ADJUSTING JOURNAL and ensure that they properly carry through to the ADJUSTED TRIAL BALANCE. Finally, REC pays income tax quarterly. The rate is 30% of income before taxes. You will need to calculate the amount due for December income and record the related liability. Use the ADJUSTING JOURNAL for this entry as well