journal entries for the following ;
1 Nov. 1 Company issues common stock 25,000 shares at $10 per share with par value of $1 per share.
2 Nov. 1 Takes a six-month short-term loan $50,000 from the bank with the interest rate 6%, with the principal and interest paid at maturity
3 Nov. 1 Purchases a property as office space at $115,000, in which $20,000 is the cost for the land and the remaining is the cost for the building. The estimated useful life of the building is 30 years and the residual value is $5,000
4 Nov. 1 Rents a warehouse and prepays the first month's rent $1,000 and security deposit $2,000
5 Nov. 1 Purchases a delivery truck for $33,000 by cash, with 5 years of estimated useful life and $3,000 residual value. The truck is estimated to be driven for 100,000 miles.
6 Nov. 2 Issues 500 preferred stocks of par value $3 for $15 each; The annual dividend is 5%.
7 Nov. 2 Purchases supplies by cash for $2,000
8 Nov. 2 Invests $10,000 in short-term investment
9 Nov. 2 Pays for the insurance premium $3,000 for six months, starting from the current month
10 Nov. 3 Receives cash advance $5,000 from customer Alpha for an order to be filled later
11 Nov. 3 Purchase 1: 2,000 units @ $50 from supplier A (by cash)
12 Nov. 8 Purchase 2: 500 units @ $55 from supplier B (50% paid immediately and the remaining is made on account)
13 Nov. 12 Sells 1,000 units priced @ $75 (sold to customer Alpha, the remaining amount is paid in full by cash immediately)
14 Nov. 15 Purchase 3: 800 units @ $60 from supplier A (made on account)
15 Nov. 16 Lends $6,000 to a client by receiving a promissory note issued by the client with interest rate of 6% and maturity of six months.
16 Nov. 20 Sells 1,200 units priced @ $78 (on account) to customer Beta
17 Nov. 22 Sells 500 units priced @ 80 (by cash) to customer Gamma
18 Nov. 25 5 units from the sale on Nov. 22 are returned and customer Gamma gets full refund immediately
19 Nov. 29 Repurchases 100 shares at $16 each for the purpose of issuing bonus to employees at the end of the year
20 Nov. 30 Announces cash dividends to common stocks, with $0.10 per share (Ignore the dividends to preferred stocks), to be paid at the beginning of next year
21 Nov. 30 Receives a bill from the bank for the month service charge $100
22 Nov. 30 Selling expense accrued in the month is $2,000 and paid in full
23 Nov. 30 Administrative expense for the month is $1,500 and paid in full
24 Nov. 30 Pays the utility bill for current month by cash $500
25 Nov. 30 Accrue salary expense $8,000 for the month, which will be paid at the beginning of the next month
26 Nov. 30 Pays for the bank service charge by cash
27 Nov. 30 Receives interest in cash from the short-term investment for the month $150
28 Nov. 30 Supplies amount to $800 at the end of the month
Additional Information Method to estimate bad debt expense: 3% Net Credit Sale
Depreciation method for the property: S-L
Depreciation method for the delivery truck: DDB
Perpetual inventory with: FIFO
The income tax rate is 30%
journal entries for the following ;
1 Nov. 1 Company issues common stock 25,000 shares at $10 per share with par value of $1 per share.
2 Nov. 1 Takes a six-month short-term loan $50,000 from the bank with the interest rate 6%, with the principal and interest paid at maturity
3 Nov. 1 Purchases a property as office space at $115,000, in which $20,000 is the cost for the land and the remaining is the cost for the building. The estimated useful life of the building is 30 years and the residual value is $5,000
4 Nov. 1 Rents a warehouse and prepays the first month's rent $1,000 and security deposit $2,000
5 Nov. 1 Purchases a delivery truck for $33,000 by cash, with 5 years of estimated useful life and $3,000 residual value. The truck is estimated to be driven for 100,000 miles.
6 Nov. 2 Issues 500 preferred stocks of par value $3 for $15 each; The annual dividend is 5%.
7 Nov. 2 Purchases supplies by cash for $2,000
8 Nov. 2 Invests $10,000 in short-term investment
9 Nov. 2 Pays for the insurance premium $3,000 for six months, starting from the current month
10 Nov. 3 Receives cash advance $5,000 from customer Alpha for an order to be filled later
11 Nov. 3 Purchase 1: 2,000 units @ $50 from supplier A (by cash)
12 Nov. 8 Purchase 2: 500 units @ $55 from supplier B (50% paid immediately and the remaining is made on account)
13 Nov. 12 Sells 1,000 units priced @ $75 (sold to customer Alpha, the remaining amount is paid in full by cash immediately)
14 Nov. 15 Purchase 3: 800 units @ $60 from supplier A (made on account)
15 Nov. 16 Lends $6,000 to a client by receiving a promissory note issued by the client with interest rate of 6% and maturity of six months.
16 Nov. 20 Sells 1,200 units priced @ $78 (on account) to customer Beta
17 Nov. 22 Sells 500 units priced @ 80 (by cash) to customer Gamma
18 Nov. 25 5 units from the sale on Nov. 22 are returned and customer Gamma gets full refund immediately
19 Nov. 29 Repurchases 100 shares at $16 each for the purpose of issuing bonus to employees at the end of the year
20 Nov. 30 Announces cash dividends to common stocks, with $0.10 per share (Ignore the dividends to preferred stocks), to be paid at the beginning of next year
21 Nov. 30 Receives a bill from the bank for the month service charge $100
22 Nov. 30 Selling expense accrued in the month is $2,000 and paid in full
23 Nov. 30 Administrative expense for the month is $1,500 and paid in full
24 Nov. 30 Pays the utility bill for current month by cash $500
25 Nov. 30 Accrue salary expense $8,000 for the month, which will be paid at the beginning of the next month
26 Nov. 30 Pays for the bank service charge by cash
27 Nov. 30 Receives interest in cash from the short-term investment for the month $150
28 Nov. 30 Supplies amount to $800 at the end of the month
Additional Information Method to estimate bad debt expense: 3% Net Credit Sale
Depreciation method for the property: S-L
Depreciation method for the delivery truck: DDB
Perpetual inventory with: FIFO
The income tax rate is 30%
Related questions
| I need assistance with these journal entries Seq. No. | Date | Transaction Description | ||
| 1 | Nov. 1 | Company issues common stock 35,000 shares at $10 per share with par value of $1 per share. | ||
| 2 | Nov. 1 | Takes a six-month short-term loan $30,000 from the bank with the interest rate 5%, with the principal and interest paid at maturity | ||
| 3 | Nov. 1 | Purchases a property as office space at $115,000 , in which $20,000 is the cost for the land and the remaining is the cost for the building. The estimated useful life of the building is 30 years and the residual value is $5,000 | ||
| 4 | Nov. 1 | Rents a warehouse and prepays the first month's rent $1,000 and security deposit $2,000 | ||
| 5 | Nov. 1 | Purchases a delivery truck for $33,000 by cash, with 5 years of estimated useful life and $3,000 residual value. The truck is estimated to be driven for 100,000 miles. | ||
| 6 | Nov. 2 | Issues 500 preferred stocks of par value $3 for $15 each; The annual dividend is 5%. | ||
| 7 | Nov. 2 | Purchases supplies by cash for $2,000 | ||
| 8 | Nov. 2 | Invests $10,000 in short-term investment | ||
| 9 | Nov. 2 | Pays for the insurance premium $3,000 for six months, starting from the current month | ||
| 10 | Nov. 3 | Receives cash advance $5,000 from customer Alpha for an order to be filled later | ||
| 11 | Nov. 3 | Purchase 1: 4,000 units @ $50 from supplier A (by cash) | ||
| 12 | Nov. 8 | Purchase 2: 1,000 units @ $55 from supplier B (50% paid immediately and the remaining is made on account) | ||
| 13 | Nov. 12 | Sells 2,000 units priced @ $75 (sold to customer Alpha, the remaining amount is paid in full by cash immediately) | ||
| 14 | Nov. 15 | Purchase 3: 1,600 units @ $60 from supplier A (made on account) | ||
| 15 | Nov. 16 | Lends $6,000 to a client by receiving a promissory note issued by the client with interest rate of 6% and maturity of six months. | ||
| 16 | Nov. 20 | Sells 2,400 units priced @ $78 (on account) to customer Beta | ||
| 17 | Nov. 22 | Sells 1,000 units priced @ 80 (by cash) to customer Gamma | ||
| 18 | Nov. 25 | 10 units from the sale on Nov. 22 are returned and customer Gamma gets full refund immediately | ||
| 19 | Nov. 29 | Repurchases 100 shares at $16 each for the purpose of issuing bonus to employees at the end of the year | ||
| 20 | Nov. 30 | Announces cash dividends to common stocks, with $0.10 per share (Ignore the dividends to preferred stocks), to be paid at the beginning of next year | ||
| 21 | Nov. 30 | Receives a bill from the bank for the month service charge $100 | ||
| 22 | Nov. 30 | Selling expense accrued in the month is $2,000 and paid in full | ||
| 23 | Nov. 30 | Administrative expense for the month is $1,500 and paid in full | ||
| 24 | Nov. 30 | Pays the utility bill for current month by cash $500 | ||
| 25 | Nov. 30 | Accrue salary expense $8,000 for the month, which will be paid at the beginning of the next month | ||
| 26 | Nov. 30 | Pays for the bank service charge by cash | ||
| 27 | Nov. 30 | Receives interest in cash from the short-term investment for the month $240 | ||
| 28 | Nov. 30 | Supplies amount to $800 at the end of the month | ||
| Additional Information | Method to estimate bad debt expense: | 3% Net Credit Sale | ||
| Depreciation method for the property: | DDB | |||
| Depreciation method for the delivery truck: | S-L | |||
| Perpetual inventory with: | FIFO | |||
| The income tax rate is 30% | ||||
he following transactions and adjusting entries were completed by Legacy Furniture Co. during a three-year period. All are related to the use of delivery equipment. The double-declining-balance method of depreciation is used.
| Year 1 | |
| Jan. 4 | Purchased a used delivery truck for $28,000, paying cash. |
| Nov. 2 | Paid garage $635 for miscellaneous repairs to the truck. |
| Dec. 31 | Recorded depreciation on the truck for the year. The estimated useful life of the truck is four years, with a residual value of $4,640 for the truck. |
| Year 2 | |
| Jan. 6 | Purchased a new truck for $49,400, paying cash. |
| Apr. 1 | Sold the used truck purchased on Jan. 4 of Year 1 for $15,180. (Record depreciation to date in Year 2 for the truck.) |
| June 11 | Paid garage $470 for miscellaneous repairs to the truck. |
| Dec. 31 | Recorded depreciation for the new truck. It has an estimated residual value of $9,470 and an estimated life of five years. |
| Year 3 | |
| July 1 | Purchased a new truck for $55,400, paying cash. |
| Oct. 2 | Sold the truck purchased January 6, Year 2, for $17,498. (Record depreciation to date for Year 3 for the truck.) |
| Dec. 31 | Recorded depreciation on the remaining truck purchased on July 1. It has an estimated residual value of $12,955 and an estimated useful life of eight years. |
Journalize the transactions and the adjusting entries. Refer to the Chart of Accounts for exact wording of account titles.
Ace Lawn Care Module 5 Mini PracticeProblem
In June, Jim made several purchases to accommodate his growingbusiness.
June2 Jim purchased a storage location for lawn care equipment, paid$45,000 for a building on 1 acre. The land is appraised at $8,000.The building has an estimated life of 10 years with a $5,000salvage value. Jim paid $2,000 down and financed the remainingpurchase price with a 5% 5 year note.
June4 Jim purchased a trailer to haul lawn care equipment for $2,300;estimated life is 5 years with no salvage value. Jim paid for thepurchase in cash.
June5 Jim purchased a gas powered trimmer for $1,200 and a commercialleaf-blower for $1,500. Jim estimates they will each have a twoyear life and no salvage value. Jim paid for both of these piecesof equipment on account.
These are in addition to the three assets Jim acquired inMay:
Date Item Cost Estimated Life Salvage Value
May 2 Truck $7,000 5 years $500
5 LawnMower $300 2 years $0
5 Aerator $500 2years $0
Depreciation was recorded in May for these assets using thestraight-line method however Jim is considering other depreciationmethods and has asked you to prepare a comparison of thestraight-line method with the double declining balance (200% DDB)method before he decides.
Instructions:
Using the chart of accounts provided below and the Exceltemplate provided with this assignment, record the transactions forthe new assets purchased in June, 2014. Start with Page7 for the journal entries. Explanations are optional.
Prepare a monthly schedule of depreciation for each of the sevenassets for 2014 using 1) straight-line and 2) 200% DDB. (Assumeassets purchased before the 15th of the month will bedepreciated as if owned for the entire month). Remember that youare calculating monthly depreciation, not annual and adjust yourdepreciation rate. Carry your depreciation rate to four decimalsand round the depreciation expense to two decimals.
Jim has decided that equipment will be depreciated usingstraight-line and the building using 200% DDB. Prepare theadjusting journal entries for depreciation for the month of June,2014. Start with Page 8 for the adjusting journalentries. Explanations are optional.
Ace Lawn Care
Chart of Accounts
Classification | Account Number | Account Name |
|---|---|---|
ASSETS | 101 | Cash |
110 | Accounts Receivable | |
112 | Allowance for Doubtful Accounts | |
115 | Notes Receivable | |
116 | Interest Receivable | |
120 | Supplies | |
130 | Prepaid Insurance | |
140 | Inventory | |
150 | Equipment | |
152 | Land | |
153 | Building | |
155 | Accumulated Depreciation â Equipment | |
156 | Accumulated Depreciation - Building | |
LIABILITIES | 201 | Accounts Payable |
220 | Notes Payable | |
225 | Interest Payable | |
OWNERâS EQUITY | 301 | Ownerâs Capital |
305 | Ownerâs Drawings | |
310 | Income Summary | |
REVENUES | 401 | Lawn Service Revenue |
410 | Sales Revenue | |
415 | Sales Returns and Allowances | |
420 | Interest Income | |
COST OF GOODS SOLD | 501 | Purchases |
505 | Purchase Returns and Allowances | |
EXPENSES | 620 | Supplies Expense |
630 | Fuel Expense | |
640 | Repair and Maintenance Expense | |
650 | Advertising Expense | |
660 | Insurance Expense | |
670 | Depreciation Expense | |
680 | Interest Expense | |
690 | Bad Debt Expense | |
695 | Miscellaneous Expense |
Asset Information: Truck, $7,000 cost, 5 year life, $500salvage value | ||||||
Computation | End of Year | |||||
Month | Depreciable | Depreciation | = | Monthly | Accumulated | Book |
May-14 | ||||||
Jun-14 | ||||||
Jul-14 | ||||||
Aug-14 | ||||||
Sep-14 | ||||||
Oct-14 | ||||||
Nov-14 | ||||||
Dec-14 | ||||||
Asset Information: Lawn Mower, $300 cost, 2 year life,$0 salvage value | ||||||
Computation | End of Year | |||||
Month | Depreciable | Depreciation | = | Monthly | Accumulated | Book |
May-14 | ||||||
Jun-14 | ||||||
Jul-14 | ||||||
Aug-14 | ||||||
Sep-14 | ||||||
Oct-14 | ||||||
Nov-14 | ||||||
Dec-14 | ||||||
Asset Information: Aerator, $500 cost, 2 year life, $0salvage value | ||||||
Computation | End of Year | |||||
Month | Depreciable | Depreciation | = | Monthly | Accumulated | Book |
May-14 | ||||||
Jun-14 | ||||||
Jul-14 | ||||||
Aug-14 | ||||||
Sep-14 | ||||||
Oct-14 | ||||||
Nov-14 | ||||||
Dec-14 | ||||||
Asset Information: Building, $37,000 cost, 10 year life,$5,000 salvage value | ||||||
Computation | End of Year | |||||
Month | Depreciable | Depreciation | = | Monthly | Accumulated | Book |
Jun-14 | ||||||
Jul-14 | ||||||
Aug-14 | ||||||
Sep-14 | ||||||
Oct-14 | ||||||
Nov-14 | ||||||
Dec-14 | ||||||
Asset Information: Trailer, $2,300 cost, 5 year life, $0salvage value | ||||||
Computation | End of Year | |||||
Month | Depreciable | Depreciation | = | Monthly | Accumulated | Book |
Jun-14 | ||||||
Jul-14 | ||||||
Aug-14 | ||||||
Sep-14 | ||||||
Oct-14 | ||||||
Nov-14 | ||||||
Dec-14 | ||||||
Asset Information: Trimmer, $1,200 cost, 2 year life, $0salvage value | ||||||
Computation | End of Year | |||||
Month | Depreciable | Depreciation | = | Monthly | Accumulated | Book |
Jun-14 | ||||||
Jul-14 | ||||||
Aug-14 | ||||||
Sep-14 | ||||||
Oct-14 | ||||||
Nov-14 | ||||||
Dec-14 | ||||||
Asset Information: Leaf Blower, $1,500 cost, 2 yearlife, $0 salvage value | ||||||
Computation | End of Year | |||||
Month | Depreciable | Depreciation | = | Monthly | Accumulated | Book |
Jun-14 | ||||||
Jul-14 | ||||||
Aug-14 | ||||||
Sep-14 | ||||||
Oct-14 | ||||||
Nov-14 | ||||||
Dec-14 | ||||||
