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29 Sep 2019
Pinkerton Corporation's trial balance at December 31, 2010,
is presented below. All 2010 transactions have been recorded exceptfor the
items described after the trial balance
Cash $28,000
Accounts Receivable 36,800
Notes Receivable 10,000
Interest Receivable -0-
Merchandise Inventory 36,200
Prepaid Insurance 3,600
Land 20,000
Building 150,000
Equipment 60,000
Patent 9,000
Allowance for Doubtful Accounts $500
Accumulated
Depreciation-Building 50,000
Accumulated
Depreciation-Equipment 24,000
Accounts Payable
27,300
Salaries Payable -0-
Unearned Rent 6,000
Notes Payable
(short-term) 11,000
Interest Payable -0-
Notes Payable (long-term) 35,000
Common Stock 50,000
Retained Earnings
63,600
Dividends 12,000
Sales 900,000
Interest Revenue -0-
Rent Revenue -0-
Gain on Disposal -0-
Bad Debts Expense -0-
Cost of Goods Sold 630,000
Depreciation Expense-Buildings -0-
Depreciation Expense-Equipment -0-
Insurance Expense -0-
Interest Expense -0-
Other Operating Expenses 61,800
Amortization Expense-Patents -0-
Salaries Expense 110,000
Total
$1,167,400
Unrecorded transactions
on May 1, 2010, Pinkerton purchased equipment for $16,000
plus sales taxes of $800 (all paid in cash).
On July 1, 2010,
Pinkerton sold for $3,500 equipment which originally cost $5,000.Accumulated
depreciation on this equipment at January 1, 2010, was $1,800;2010
depreciation prior to the sale of equipment was $450.
On December 31, 2010,
Pinkerton sold for $5,000 on account inventory that cost$3,500.
Pinkerton estimates
that uncollectible accounts receivable at year-end are$4,000.
The note receivable
is a one-year, 8% note dated April 1, 2010. No interest has beenrecorded.
The balance in
prepaid insurance represents payment of a $3,600, 6-month premiumon September
1, 2010.
The building is being
depreciated using the straight-line method over 30 years. Thesalvage value is
$30,000.
The equipment owned
prior to this year is being depreciated using the straight-linemethod over 5
years. The salvage value is 10% of cost.
The equipment
purchased on May 1, 2010, is being depreciated using thestraightline method
over 5 years, with a salvage value of $1,800.
The patent was
acquired on January 1, 2010, and has a useful life of 9 years fromthat date.
Unpaid salaries at
December 31, 2010, total $2,200.
The unearned rent of
$6,000 was received on December 1, 2010, for 3 months rent.
Both the short-term
and long-term notes payable are dated January 1, 2010, and carry a10% interest
rate. All interest is payable in the next 12 months.
Income tax expense
was $15,000. It was unpaid at December 31.
(a) prepare journal entries for the transactions listed above
(b) prepare an updated december 31, 2011 trial balance
(c) prepare a 2011 income statement and a 2011 retained earningsstatement
(d) prepare a december 31 2011 balance sheet
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Pinkerton Corporation's trial balance at December 31, 2010,
is presented below. All 2010 transactions have been recorded exceptfor the
items described after the trial balance
Cash $28,000
Accounts Receivable 36,800
Notes Receivable 10,000
Interest Receivable -0-
Merchandise Inventory 36,200
Prepaid Insurance 3,600
Land 20,000
Building 150,000
Equipment 60,000
Patent 9,000
Allowance for Doubtful Accounts $500
Accumulated
Depreciation-Building 50,000
Accumulated
Depreciation-Equipment 24,000
Accounts Payable
27,300
Salaries Payable -0-
Unearned Rent 6,000
Notes Payable
(short-term) 11,000
Interest Payable -0-
Notes Payable (long-term) 35,000
Common Stock 50,000
Retained Earnings
63,600
Dividends 12,000
Sales 900,000
Interest Revenue -0-
Rent Revenue -0-
Gain on Disposal -0-
Bad Debts Expense -0-
Cost of Goods Sold 630,000
Depreciation Expense-Buildings -0-
Depreciation Expense-Equipment -0-
Insurance Expense -0-
Interest Expense -0-
Other Operating Expenses 61,800
Amortization Expense-Patents -0-
Salaries Expense 110,000
Total
$1,167,400
Unrecorded transactions
on May 1, 2010, Pinkerton purchased equipment for $16,000
plus sales taxes of $800 (all paid in cash).
On July 1, 2010,
Pinkerton sold for $3,500 equipment which originally cost $5,000.Accumulated
depreciation on this equipment at January 1, 2010, was $1,800;2010
depreciation prior to the sale of equipment was $450.
On December 31, 2010,
Pinkerton sold for $5,000 on account inventory that cost$3,500.
Pinkerton estimates
that uncollectible accounts receivable at year-end are$4,000.
The note receivable
is a one-year, 8% note dated April 1, 2010. No interest has beenrecorded.
The balance in
prepaid insurance represents payment of a $3,600, 6-month premiumon September
1, 2010.
The building is being
depreciated using the straight-line method over 30 years. Thesalvage value is
$30,000.
The equipment owned
prior to this year is being depreciated using the straight-linemethod over 5
years. The salvage value is 10% of cost.
The equipment
purchased on May 1, 2010, is being depreciated using thestraightline method
over 5 years, with a salvage value of $1,800.
The patent was
acquired on January 1, 2010, and has a useful life of 9 years fromthat date.
Unpaid salaries at
December 31, 2010, total $2,200.
The unearned rent of
$6,000 was received on December 1, 2010, for 3 months rent.
Both the short-term
and long-term notes payable are dated January 1, 2010, and carry a10% interest
rate. All interest is payable in the next 12 months.
Income tax expense
was $15,000. It was unpaid at December 31.
(a) prepare journal entries for the transactions listed above
(b) prepare an updated december 31, 2011 trial balance
(c) prepare a 2011 income statement and a 2011 retained earningsstatement
(d) prepare a december 31 2011 balance sheet
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Jarrod RobelLv2
29 Sep 2019