Accounting Answers

Record the following transactions using the accounting equation and T accounts.

1.     Owner contributed $50,000 in cash for company stock.

2.     Purchased building for $120,000, making a $20,000 down payment and signing a promissory note for the balance.

3.     Sold products to customers for $15,000 cash.

4.     Paid utilities expense of $2,000.

5.     Reduced note payable with an $8,000 cash payment (ignore interest costs).

6.     Incurred expense of $3,000, to be paid in the future (accounts payable).

7.     Collected $4,000 on an outstanding account receivable.

State briefly what you think took place on each of these nine days, assuming that only one transaction occurred each day

Blizzard Corporation bought a machine at a cost of 6400 USD for a new line of production of ice-creams. The estimated useful life was four (4) years and the salvage value was 800 USD. Assume that the estimated productive life of the machine is 80 000 pieces of ice-creams. Yearly production was: Year 2017, 28 000 pieces; Year 2018, 22 000 pieces; Year 2019, 18 000 pieces and year 2020, 12 000 pieces.

Determine the amount for each method of depreciation in the following table, show your work:

Depreciation expense: Years Straight-line method, Units of production method, Double declining balance method

2017 2018 2019 2020

150 000 ordinary shares at no par value 700 000

5% Redeemable cumulative preference shares at N$2.00 each 300 000

Shares premium account 45000

Capital redemption reserve fund 50000

Retained earnings 258000

Bank overdraft 105350

Preliminary expenses 15000

Dividends payable 15000

Underwriters commission ( on ordinary shares) 20000

Inventory 26350

Property 1450000

Equipment 755600

Required:

1.Prepare General Journal entries

2.Prepare statement of changes in equity

Ubisoft Entertainment is a partnership of exclusive game distributor who specialist in electronic arts and play stations. The two partners who shares profit and losses equally are the brothers Arthur and Blaise. Arthur and Blaise youngest brother Claude recently graduated as a sound engineer and Arthur and Blaise decided to admit Claude as a third partner of Ubisoft Entertainment on 1 January 2021.

Required:

2.1Prepare the statement of profit and loss and other comprehensive income for the year ended 31 December 2020 for Ubisoft Entertainment.

2.2Prepare the Profit Appropriation account as at 31 December 2020 before Claude was admitted as a partner

2.3Provide Journal entries for Claude admission as a partner on 1 January 2021.

Sampson Manufacturing Company (SMC) has an empty warehouse that it rents out to a local beer distributor for a monthly rental fee of $6,000. Terms of the rental agreement include a 10-day payment grace period and an additional $200 monthly utility expense, necessary to maintain the beer distributor's products at the proper temperature, paid by SMC. Assuming that SMC records journal entries on a monthly basis, and that it receives the December monthly rent payment on January 9th, what is the adjusting journal entry (if any) made by SMC on December 31 (with December's $200 utility payment made on January 2)?

- Debit Rent Receivable $6000

- Debit Utilities Expense $200

- Credit Rent Revenue $6000

- Credit Utilities Payable $200

The answer is highlighted. Are there any other journal entries that I need to know for this question? Thank you.

Windy Harbor Boat Company pays its employees on a weekly basis each Friday. During the week ended Friday, January 3, Year 2, the company had a weekly payroll of $125,750. Assuming that the company is on a calendar basis and that daily wages are always the same, what adjusting journal entry (if any) would be made on December 31, Year 1?

- Debit Salaries Expense $50,300

- Credit Accrued Salaries $50,300

The answer is highlighted. Are there any other journal entries that I need to know for this question? Thank you.

During the fourth quarter ended December 31, Year 1, Lighting Fixtures Inc. (LFI) had average outstanding revolving bank loans of $1.2 million. Assume that the quarterly interest charges associated with these loans was $7,500. If LFI makes the interest payment to the banks on January 15, Year 2, what is the journal entry (if any) made by the company on December 31 to reflect the above?

-Debit Interest Expense $7500

-Credit Accrued Interest $7500

The answer is highlighted. Are there any other journal entries that I need to know for this question? Thank you.