XOS Corporation (XOS) sells accounting-related memorabilia at asmall store. The company was organized and began operations onJanuary 1, 2016.
Events During January,2016:
1. On January 1, the owner invested $100,000 cash in thecompany, receiving 1,000 shares of $2 par value common stock inexchange.
2. On January 1, XOS purchased furniture and fixtures for$30,000. Paid $5,000 cash down, and signed a promissorynote with a 12% annual rate of interest for the balance of thepurchase price. Note plus interest to be paid in 2 years.
3. On January 1, XOS paid two months rent in advance to mallowners for floor space, $6,000.
4. On January 1, XOS paid a one-year premium for liability andcasualty insurance, $1,200.
5. During January, the company purchased merchandise inventoryon account for $25,000.
6. During January, sales totaled $48,000 ($28,000 for cash and$20,000 on credit). The cost of the merchandise sold was$20,000. XOS uses a perpetual inventory system.
7. During January, the company paid wages totaling $3,000.
8. During January, payments on account to suppliers of inventorytotaled $9,000.
9. During January, a customer ordered 100 custom-made t-shirtssaying âSOX ROX!â-for delivery in February, 2016. XOSrequired payment in advance ($1,000) for the entire order.
10. During January, customers paid $10,000 to XOS forsales made on credit
Additional Information:
The furniture and fixtures have an expected useful life of 5years and zero expected salvage value. XOS usesthe straight-line method of depreciation.
At January 31, employees have earned wages of $1,000 that willnot be paid until February.
Utilities charges for January are estimated to be $600. However,the utilities bill will not be received and paid untilmid-February.
Requirements
*2. Prepare any necessary adjusting journal entries atJanuary 31, and post related amounts to the T-Accounts. Thenprepare an adjusted trial balance at January 31.
(Hint: There are 6 AJEâs)
XOS Corporation (XOS) sells accounting-related memorabilia at asmall store. The company was organized and began operations onJanuary 1, 2016.
Events During January,2016:
1. On January 1, the owner invested $100,000 cash in thecompany, receiving 1,000 shares of $2 par value common stock inexchange.
2. On January 1, XOS purchased furniture and fixtures for$30,000. Paid $5,000 cash down, and signed a promissorynote with a 12% annual rate of interest for the balance of thepurchase price. Note plus interest to be paid in 2 years.
3. On January 1, XOS paid two months rent in advance to mallowners for floor space, $6,000.
4. On January 1, XOS paid a one-year premium for liability andcasualty insurance, $1,200.
5. During January, the company purchased merchandise inventoryon account for $25,000.
6. During January, sales totaled $48,000 ($28,000 for cash and$20,000 on credit). The cost of the merchandise sold was$20,000. XOS uses a perpetual inventory system.
7. During January, the company paid wages totaling $3,000.
8. During January, payments on account to suppliers of inventorytotaled $9,000.
9. During January, a customer ordered 100 custom-made t-shirtssaying âSOX ROX!â-for delivery in February, 2016. XOSrequired payment in advance ($1,000) for the entire order.
10. During January, customers paid $10,000 to XOS forsales made on credit
Additional Information:
The furniture and fixtures have an expected useful life of 5years and zero expected salvage value. XOS usesthe straight-line method of depreciation.
At January 31, employees have earned wages of $1,000 that willnot be paid until February.
Utilities charges for January are estimated to be $600. However,the utilities bill will not be received and paid untilmid-February.
Requirements
*2. Prepare any necessary adjusting journal entries atJanuary 31, and post related amounts to the T-Accounts. Thenprepare an adjusted trial balance at January 31.
(Hint: There are 6 AJEâs)
Related questions
The following information applies to the questions displayed below.]
The following is the post-closing trial balance for the Whitlow Manufacturing Corporation as of December 31, 2017.
| Account Title | Debits | Credits | ||||
| Cash | 5,100 | |||||
| Accounts receivable | 2,100 | |||||
| Inventory | 5,100 | |||||
| Equipment | 11,100 | |||||
| Accumulated depreciationâequipment | 3,600 | |||||
| Accounts payable | 3,100 | |||||
| Common stock | 9,000 | |||||
| Retained earnings | 7,700 | |||||
| Sales revenue | 0 | |||||
| Cost of goods sold | 0 | |||||
| Salaries and wages expense | 0 | |||||
| Rent expense | 0 | |||||
| Advertising expense | 0 | |||||
| Totals | 23,400 | 23,400 | ||||
The following transactions occurred during January 2018:
| Jan. | 1 | Sold merchandise for cash, $3,600. The cost of the merchandise was $2,100. The company uses the perpetual inventory system. | ||
| 2 | Purchased equipment on account for $5,600 from the Strong Company. | |||
| 4 | Received a $200 bill from the local newspaper for an advertisement that appeared in the paper on January 2. | |||
| 8 | Sold merchandise on account for $5,100. The cost of the merchandise was $2,900. | |||
| 10 | Purchased merchandise on account for $9,550. | |||
| 13 | Purchased equipment for cash, $900. | |||
| 16 | Paid the entire amount due to the Strong Company. | |||
| 18 | Received $4,200 from customers on account. | |||
| 20 | Paid $900 to the owner of the building for Januaryâs rent. | |||
| 30 | Paid employees $3,100 for salaries and wages for the month of January. | |||
| 31 | Paid a cash dividend of $900 to shareholders. Post the transactions into the appropriate T-accounts. (Enter the date of the transaction in the column next to the amount. Be sure to include beginning balances.) |
Vaughn Weller, D.D.S., opened a dental practice on January 1, 2017. During the first month of operations, the following transactions occurred.
| 1. | Performed services for patients who had dental plan insurance. At January 31, $721 of such services was performed but not yet billed to the insurance companies. | |
| 2. | Utility expenses incurred but not paid prior to January 31 totaled $523. | |
| 3. | Purchased dental equipment on January 1 for $88,000, paying $20,000 in cash and signing a $68,000, 3-year note payable. (a) The equipment depreciates $408 per month. (b) Interest is $540 per month. | |
| 4. | Purchased a one-year malpractice insurance policy on January 1 for $11,160. | |
| 5. | Purchased $1,449 of dental supplies. On January 31, determined that $470 of supplies were on hand. |
Prepare the adjusting entries on January 31. Account titles are Accumulated Depreciation-Equipment, Depreciation Expense, Service Revenue, Accounts Receivable, Insurance Expense, Interest Expense, Interest Payable, Prepaid Insurance, Supplies, Supplies Expense, Utilities Expenses, and Utilities Payable. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts.)
| No. | Account Titles and Explanation | Debit | Credit |
