award:
10outof
1
•
10.00
· .......... · points
........................................................................................................................................................................................... ·
From the dropdown box beside each numbered balance sheet Item, select the letter of its balance sheet
classification. If the item should not appear on the balance sheet, choose the letter Z from the selection
choices.
A. Current assets
B. Long-term investments
C. Plant assets
o. Intangible assets
E. Current liabilities
F. Long-term liabilities
G. Equity
Account Title
Classification
A
.I
.I
.I
.I
.I
.I
.I
.I
.I
G
.,1120.
1.
Long-tem1 investment in stock
B
2
Depreciation expense-Building
z
Prepaid rent
A
Interest receivable
A
Taxes payable
E
6.
Automobiles
c
7.
Notes payable (due in 3 years)
F
E
8.
Accounts payable
9.
Prepaid insurance
10.
OWner, Capital
Account Title
Classification
11.
Unearned seivices revenue
E
12.
Accumulated depreciation- Trucks
c
13.
Cash
14.
Buildings
c
15.
Store supplies
A
16.
Office equipment
c
c
17.
E and (used in operations)
.A
18.
Repairs expense
z
19.
Office supplies
A
ICurrent portion of long-term note payable
E
./
./
./
./
./
./
./
./
./
./
· · · · · ·Ailiii··1;·2513:·11;0·Nozoiiiicieaieii··a·r;;,:.i;··fravei . a9enci:·"Actveiifuietiavei·:rhefoiio\;iiiiilfraiisaciioiis····
occurred during the company's first month.
April 1 Nozomi invested $30,000 cash and computer equipment worth $20,000 in the company.
The company rented furnisl1ed office space by paying $1,800 cash for the first month's
2 (April) rent
3 The company purchased 51 ,000 of office supplies for cash.
10 The company paid $2,400 cash for the premium on a 12-month insurance policy. Coverage
begins on April 11.
14 The company paid $1,600 cash for two weeks' salaries earned by employees.
24 The company collected S8,000 cash on commissions from airtines on tickets obtained for
customers.
28 The company paid $1,600 cash for two weeks' salaries earned by employees.
29 The company paid $350 cash for minor repairs to the company's computer.
30 The company paid $750 cash for this month's telephone bill.
30 Nozomi withdrew $1,500 cash from the company for personal use.
The company's chart of accounts follows:
101
106
124
128
167
168
209
301
302
Cash
Accounts Receivable
Office Supplies
Prepaid Insurance
Computer Equipment
Accumulated Depreciation-Computer Equip.
Salaries Payable
J.Nozomi, Capital
J.Nozomi, Withdrawals
405
612
622
637
640
650
684
688
901
Commissions Earned
Depreciation Expense-Computer Equip.
Salaries Expense
Insurance Expense
Rent Expense
Office Supplies Expense
Repairs Expense
Telephone Expense
Income Summary
Use the following information:
a.
b.
c.
d.
e.
2.
Two-thirds (or $133) of one month's insurance coverage has expired.
At the end of the month, 5600 of office supplies are still available.
This month's depreciation on the computer equipment is $500.
Employees earned $420 of unpaid and unrecorded salaries as of month-end.
The company earned $1,750 of commissions that are not yet billed at month-end.
award:
10 out of
10.00
· · · · · · ··points ··
Required :
1. The general ledger and all the necessar1 accounts are provided in Part 6.2. Post all journal entries,
adjusting entries and closing entries to the general ledger given in Part 6.2
2. Prepare journal entries to record the transactions for Ap<il and post them to the ledger accounts in
Part 6.2. The company records prepaid and unearned items in balance sheet accounts.
Date
April 01
Computer equipment
J. Nozomi, Caprtal
April 02
Debit
General Journal
Cash
./
./
./
Rent expense
20,000./
50,000./
1,800./
Cash
April 03
Office supplies
1,800./
./
1,000./
Gash
April 10
Prepaid insurance
Cash
April 14
1,000./
./
./
Salaries expense
2,400./
2,400./
1,600./
Cash
April 24
Cash
Commissions earned
April 28
Salaries expense
Cash
April 29
Repairs expense
Cash
April 30
Telephone expense
Cash
April 30
J. Nozomi, Withdrawals
Cash
Credit
30.000./
1,600./
./
./
8,000./
./
./
1,600./
./
./
350./
./
./
750./
./
./
1,500./
8,000./
1,600./
350./
750./
1,500,.il
3.
award:
10 out of
10.00
3. Using account balances from part 6.2, prepare an unadjuste<l trial balance as of April 30.
ADVENTURE TRAVEL
Unadjusted Trial Balance
April 30, 2013
Account Title
101: Cash
106: Accounts receivable
Debit
$
Credit
27,000yl
o.;
124: Office supplies
1,000.;
128: Prepaid insurance
2,400.I
167: Computer equipment
20.000.;
o.;
o.;
168: Accumulated depreciation- Computer equipment
209: Salaries payable
301: J. Nozomi, Capital
302: J. Nozomi, Witlldrawals
50,000yl
1,500.I
405: Commissions earned
612: Depreciation expense- Computer equipment
622: Salaries expense
637: Insurance expense
640: Rent expense
650: Office supplies expense
684: Repairs expense
688: Telephone expense
Total
8,000./
o.;
3,200.I
o.;
1,800.I
o.;
350v'
750.I
58,000 I' $
58,000
SV.'3.td:
10out of
4
.
10.00
............................ 'P<ll'OIS ..................................................................................................................... ..
4. Journalize the adjusting entries for the month and then post to section 6.2.
Transaction
-
a.
General Journal
Prepaid insurance
,/
,/
Office supplies expense
,/
'insurance expense
..
Debit
133,/
Credit
133,/
I
b.
Office supplies
c.
Depreciation expense-Computer equip.
Accumulated depreciation-Computer equip.
d.
Salaries expense
Salaries payable
Accounts receivable
Comn1issions earned
400,/
,/
400,/
,/
,/
500,/
,/
,/
420,/
,/
,/
1,750,/
500,/
420,/
1,750,/
award:
10outof
5
•
10.00
..................... pol'nts................................................................................................
5.1 Prepare the income statement for the month of April 30, 2013.
ADVENTURE TRAVEL
Income Statement
For Month Ended April 30, 2013
Revenues:
-
- -
-
.I
Commissions earned
~
Depreciation expense-Computer equip.
Salaries expense
Insurance expense
Rent expense
Office supplies expense
Telephone expense
Repairs expense
9,750./
$
-
,Expenses:
.I $
.I
.I
.I
.I
.I
.I
500./
3,620.I
133./
1.800./
400./
750./
350./
0
0
Total expenses
7,553
.I
Net income
2,197
$
5.2 Prepare the statement of owner's equi~/ for the month of April 30, 2013.
ADVENTURE TRAVEL
Statement of OWner's Equity
For Month Ended April 30, 2013
1$
J. Nozomi, Capital, April 1, 2013
Add: Net income
Add: Owner investments
Less: Wrthdrawals
J.Nozomi, Capttal, April 30, 2013
.I $
.I
.I
.I
0
2,197./
50,000./
'$
52,197
1.500./1
50,697
5.3 Prepare the balance sheet at April 30, 2013.
ADVENTURE TRAVEL
Balance Sheet
April 30, 2013
I
Assets
Cash
27,000.I
Accounts receivable
1.750./
Office supplies
600.I
Prepaid insurance
Computer equipment
Accumulated depreciation-Computer equip
Total assets
---
2,2fi7.I
20,000.I
19,500
500./
$
51,117
Liabilities
Salaries payable
420.I
Equity
J. Nozomi, Capital
50,697./
Total liabilities and equity
51,111
I
award:
10out of
6
.
10.00
........................... points ...
6.1 Prepare journal entries to close the temporary accounts and t11en post to section 6.2.
General Journal
Date
Aprif 30
Debit
Commissions earned
9.750./
Income summary
April 30
credit
9.750./
Income summary
Depreciation expense-Computer equip.
500J
Salaries expense
3,620./
Insurance expense
133./
Rent expense
April 30
1,800./
Office supplies expense
400./
Repairs expense
350./
Telephone expense
750./
Income summao1
./
April 30
2,197./
./
J. Nozomi, Capital
-+--
1
2.197./
I
J . Nozomi, Capital
./
1,500./
./
J. Nozomi. Withdrawals
1.500./
6.2 Post the journal entries to the ledger.
General Ledger accounts
==
Debit
Date
April 1
Cash
Credit
Balance
30,000./
30,000
April2
1,800./t -
28.200
April 3
1.000./
27,200
April 10
2,400./
24,800
April 14
1.600./
23,200
April24
Accounts Receivable
Date
.April 30 Adj.
.April28
1,600./
29,600
April 29
350./
29,250
April 30 Tel.
750./
28,500
,April 30 WD
1,500./
27,000
Debit
April 3
1--
*Red lc;..l lnU1...,tb
O;:d!_.,,.tt::l
Credit
i;.
1:::!.jJUll~ l'M ~ :.<pt!~lteiJ
1,000
400./
•o
1~:.1JV1+!.~
Date
Balance
!"'""-------;-------~
1
April 30 Adj.
im.1 ~~4tl:'>
~iun
Debit
( pril 1
./_,_
./'
April 30Adj.
600
v.:1> e10.1tl:.tcd in ii i.tll v1 "(1.1rt111.1f..,.b.,!>ct.I tolo.
---
Ind u:I! ot d
Debit
April 10
(u1m,,.1,.,i ·l.io~etJ
h. ir1·;.1Y1cc.t ,,-:: S)Uiti!.":o
Credit
__
.....II
Credit
2,400./L
20.000
d~d:.d1....J
<1
cell ..;1 <1 h.11111ul:1·bihed :...lwI..aiuu i:. irtc:111ect
Debit
.April 30 Adj.
5J
Credit
./
----!-
'''° puir•b
Balance
420./
Date
Debit
April 30 WD
420
April 30 Close
ir1 <i Ct:ll ur <1 fu1u1i..l.3 ·1J4:r..:IJ
im.l ~~tt:'>
•tr ;~:.IJVl•!.C
Commissions earned
Balance
1.500./•
Date
1.500
0
1,500./
v.<1> <:!XIJti:.lt!d iri O Ltdl IJ!
,;,
52~~
50.697
1,500.I
c...1w,4:iu11 if> 1n,.:.o.i1c<.t. tl<l j.1tii11~
Credit
./
50,000
2.197./r
April 30WD
Debit
(1.1rr11uf..,.b.,!.tet.I :.olu.:
~jl)I\
Credit
Balance
April 24
8,000./
8,000
April 30Adj.
1,750./
9,750
April 30 Close
•Red teitl
500
50,000./
T
./
Balance
Balance
Credit
April 30 Inc
Debit
oo µcil
*ReiJ h:~l lnu1...,tb "1:::!>1JUH~ 1·M ~ :.<pt!~lteiJ Ind u:I! ot .i ru1m,,.1,.,i ·l.io:.~tJ :..iilw •.;;!llJI\ ·~ l"t:t.o!'t<:•. nu µuu
d.::ll -<.hi:t3.
J. Nozomi, Withdrawal s
Date
2,267
J. Nozomi, Capital
Credit
w.i~ t:-'-p~:.lcCI
2,400
_l
Salaries Payable
•RcCI lcl<.l i11di.c.it..::. r:> se:.fJU•~:r.c
<J::J .."-Lt:tL
Balance
I
I
[Adj ~
l"t:t.o!'t<:\.. OU f.IUll
~~-~--~
133./J
'lktJ lt:it! indr~:t.:. u •t!!>µVn:.e w<1 S ~xpc::led lr1
oJ-::\.1 ..«lCl:I.
Date
Balance
20.000./
Debit
•~
Accumulated Depreciation-Computer equipment
• !kiJ lest i11.Jil..dtb "u 'ei.1.11.11•~c 1.,<iS. CXJJt:tlt:iJ iri ., u:ll ur a (un11uld·b.ucl.I :...1...u:,.1it111 i!> ui-:()- 1.:~.t
Date
:..iilw •.;;111JI\
.,----~-
---~
Computer Equipment
Date
1.750
Prepaid Insurance
1,000./
•Red lCJ<.l
<il:t.l--lE::J
Balance
1.750./
Office Supplies
Date
Credit
---~-
31,200
8,000./
Debit
0
9,750./
h. !r1·;.1Y1ec.t ,,-:: l)Uiti!.">-
.u:d~-le:j
Salartes Expense
Depreciation Expense--Computer Equipment
=
Debit
Date
April 30Adj.
./
Credit
500./
500
>--
500y ..._
( pril 30 Clos_
e __
./
'""•
l
Debit
Date
Balance
0
./
./
./
April 14
.April 28
April 30 Adj.
April 30 Close
'Rtea h:,.,l iud.<;<ite :> ce!.1J011:.c
1~:1:. ~XfJe:.lted
in o :.t:ll <11 o (1)1 ni.;l:1·1J4:.<:d Caolo,; •a:iuo i!. i•1-.:.:n!<."!.
n~
Credit
Balance
1.600./1
1.600
1,600./
3,200
420./
3.620
./
0
3.620./
-~~--
l'Olrt:'!.
~.::J _.de:J.
Insurance Expense
...
Date
Debit
Credit
~~~~-~~-~~-
ApriI 30 Adj.
./
April 30 Close
./
Rent Expense
Balance
133./
Date
133
0
133./
Debit
April 2
./
April 30 Close
./
Credit
1.800./
1,800
~dku
I
,.;1u11 Ii.
j,,t;1.>·1~.~
no !Julnb
<J~du.tc~
• Rt:IJ l~:d 1111.l•W-tl:'!> t·:.>Jl=t>f,IVll:Ot: W<I\> t:Xj.IC:.~~ll 111 <I t.l:ll TJI d (011111Jl..:l•lJo'>l;!tJ ( 1:SiW .::1U11 I!> l lll,;\.O.'.f {!t;! tHJ µVii
d.::cl-dcd.
Office Supplies Expense
Date
Debit
April 30 Adj.
Balance
400./
·~:.µUn!.~ l'l d:.
Debit
Date
400
400./
u
0
:,o;j):::Llted ill a u:ll ur o ft111111iLf·IJd!><!:l.I Loki.; otiuh b lr1u.>U ..:1..! JUU µui t•U.
April 29
./
.April 30 Close
./
•Rtiu l<:xt ln1.!>;Ai.16 u
Debit
April 30 Close
Balance
350./
350
350./
--+---
·~:.f.IO•u.lo! ~..s
':!.ltl't't.lt!U in
0
a u.:11 u1., fu11111..tl<1·b•H.ciJ 1.4lt.1.. =!lun b l rX:IJ(1r.:... : no IJQii
Income Summary
./
./
Credit
750
April 30 Rev.
0
.April 30 Exp.
750./
•R.:U lcxl ind.wto:.:. u 41:!.!Jtm!.c W<1$ :x!Jc:.h::IJ In <1 u:!! u1 o (1.11111ul.:i·IJ0:.c!.I
~dku
,.;1u11 Ii.
Debit
Date
Balance
April 30 Close
<.l~du.tc~
Credit
d¢J1.K.lc!J.
Telephone Expense
April 30
__.
Repairs Expense
Credit
April 30 Close
•Rcd l<=X.I ii u.l...<11'=-'C<:dt.Xh..'-0
0
1,800./
I
•R.:U l cxl ind.wto:.:. u 41:!.!Jtm!.c W<1$ :x!Jc:.h::IJ In <1 u:!! u1 o (1.11111ul.:i·IJ0:.c!.I
Balance
lr•t;1.>·1 ~.~
no !Julnb
./
./
./
Credit
9,750./
7,553./
2,197./
2,197
I
0
award:
10 out of
7.
10.00
.... ... ... ... ... ... "poi'iits
.............................................................................. ·· .....................................................................................................................· ·
7. Prepare a post-closing trial balance. (Please prepare your trial balance i n chan of acco unts o rder
g iven in the q uestio n.)
ADVENTURE TRAVEL
Post-Closing Trial Balance
April 30, 2013
Account TiUe
Credit
Debit
Cash
./ $
Accounts receivable
./
1,750./
Office supplies
./
600./
Prepaid insurance
./
2,267./
Computer equipment
./
Accumulated depreciation-Computer equipment
./
500./
Salaries payable
./
420./
J.Nozomi, Capttal
./
Totals
27.000./
50,697./
.~~~~~~-'--~~~~~--;
1$
51.617
$
51,617
I
·~~~~~~-'--~~~~~-'
8.
award:
10 out of
10.00
........................... ·poi·n1s ···
The adjusted trial balance for Tybalt Construction as of December 31 , 2013, follows.
No.
101
104
125
128
167
158
173
174
183
201
203
208
210
213
233
251
301
302
401
406
407
409
605
612
623
633
637
640
652
682
683
684
688
690
TYBALT CONSTRUCTION
Adjusted Trial Balance
December 31, 2013
Account Title
Cash
Short-term investments
Supplies
Prepaid insurance
Equipment
Accumulated depreciation- Equipment
Building
Accumulated depreciation- Building
Land
Accounts payable
Interest payable
Rent payable
Wages payable
Property taxes payable
unearned professional fees
Long-term notes payable
o . Tybalt, Capital
0 . Tybalt, Withdrawals
Professional fees earned
Rent earned
s
Debit
5,000
23,000
8,100
7,000
40,000
Crecfit
s
20,000
150,000
50.000
55,000
15,500
2,500
3,500
2,500
900
7,500
67,000
125,400
13,000
97,000
14,000
Dividends earned
2,000
Interest earned
Depreciation expense-Building
Depreciation expense-Equipment
Wages expense
Interest expense
Insurance expense
Rent expense
Supplies expense
2.100
11,000
5,000
32,000
5,100
10,000
13,400
7,400
Postage expense
Property taxes expense
Repairs expense
Telephone expense
Utilities expense
4,200
5,000
8,900
3,200
4,600
s
Totals
411,900 $ 411,900
0 . Tybalt invested $5,000 cash in the business during year 2013 (the December 31, 2012, credit balance
of the o . Tybalt, Capital account was S121,400). Tybalt Construction is required to make a $7,000
payment on its long-term notes payable during 2014.
Required :
1.1 Prepare the income statement for the calendar year 2013.
TYBALT CONSTRUCTION
Income Statement
For Year Ended December 31, 2013
Revenues
Professional fees earned
./ $
97,00o./
Rent earned
./
./
./
14.000./
Dividends earned
Interest earned
2,000./
$
$
Total revenues
$
r
Expenses
Depreciation expense-buildi~g
./
11.00o./
Depreciation expense-equipment
./
./
./
./
6.000./
Wages expense
Interest expense
Insurance expense
32,000./
Property taxes expense
./
./
./
./
Repairs expense
./
8.900./
Telephone expense
./
3,200./
Utilrties expense
./
4.60~./1
Rent expense
Supplies expense
Postage expense
115.100
4.200./
5,000./
Total expenses
110,800
Net income
$
4,300./
1.2 Prepare the statement of owner's equity for the calendar year 2013.
TYBALT CONSTRUCTION
Statement of OWner's Equity
For Year Ended December 31, 2013
O. TYbalt, Capital, Dec. 31, 2012
Add: Investments by owner
Add: Net income
Less: Withdrawals by owner
o . Tybalt, Capital, Dec. 31, 2013
./
:$
5,000./
4,300./
121,400.,.I
1.3 Prepare the classified balance sheet at December 31 , 2013..
TYBALT CONSTRUCTION
Balance Sheet
Decernber31,2013
Assets
./
Current assets
Cash
./ $
Short-term investments
./
./
./
./
./
./
./
./
./
./
./
./
Supplies
Prepaid insurance
Total current assets
Plant assets
Equipment
Accumulated depreciabo~qu1pment
Building
Accumulated depreciafion-building
Land
Total plant assets
Total assets
5,000./
23,000./
8,100./
1.000.11
43,100
$
40.000./
20.000
20.000.11
150.ooo,/l
50,000./
100,000
55,000./
__,
175.000
1$
218,100
./
Liabilities
16.500./
Interest payable
./
./
./
Rent payable
./
3,500./
Wages payable
./
./
./
2,500./
Current liabilities
Accounts payable
Property taxes payable
Unearned professional fees
Current portion o! long-term note payable
Total current liabilities
Long-term liabilities
Long-term notes payable
Total liabilities
2,500./
900./
7,500./
./
./
.JI
./
./
7,000./
f
40,400
60,000./
100.400
Equity
o. Tybalt, Capital
./
./
117,700./ •
••
~
2. Prepare the necessary closing entries at December 31, 2013.
Closing entries (all dated December 31. 201 3):
General Journal
Professional fees earned
Date
Dec 31
./
./
./
./
Rent earned
Dividends earned
Interest earned
Income summary
Depreciation expense-equipment
Wages expense
Interest expense
Insurance expense
Rent expense
Supplies expense
2,000./
2.100./
115.100./
110,800./
11.000./
6 ,000./
32.000./
5,100./
10,000./
13,400./
./
./
./
./
Postage expense
Property taxes expense
Repairs expense
7,400./
4,200./
5.000./1
8,900./
./
./
Telephone expense
Utilities expense
Dec 31
14.000./
./
./
./
./
./
./
./
Depreciation expense-building
Dec 31
97.000./
./
Income summary
Dec 31
Credit
Debit
Income sum mar~
o. Tybalt, Capital
./
o. Tybalt, Capital
o. Tybalt, Wrthdrawals
./
./
3,200./
4,600./
4.300./
./
4,300./1
13,000./
13.000./
3. Use the information in the financial statements to compute Ille following ratios:
1aJ Return on assets (total assets at December 31, 2012. was $200,000)
I
Numerator:
Net income
./
4,300./
$
b)
Debi ratio
Average total assets
...
~~
.....$
~~
$
c)
./
100.400./
Total assets
./
21 8,100./
$
~,......~~......~
=
=
%
+
Debt ratio
Debt ratio
d4t>;
j
~...i.~~~.....iiiiiiii--~.-;;--.....iiiiiiiiiiiiiiiiiiiiiiii.....m/
Profit margin
Denominator:
./
4,300./
Total revenues
./
115,100./
$
~t margin
=
'.H G %
Current ratio
Numerator:
Current assets
$
2.06
Profit margin ratio (use total revenues as the denominator)
Net income
d)
209.050./
Return on total assets
=
=
Denominator.
Numerator:
$
./
~-
Numerator:
Tota!liabilities
Return on total assets
Denominator.
Denominator:
./
43.100./
Current liabilities
$
./
40,400./
=
=
Current ratio
Current ratio
{ 07
:1
9•
award:
9.76 out of
10.00
···························points···
Refer to the following Hawkeye Ranges.
a. As of December 31 , 2013. employees had earned $1,200 of unpaid and unrecorded salaries. The
next payday is January 4, at which time $1 ,500 of salaries will be paid.
b. The cost of supplies still available at December 31 , 2013 . is $3,000.
c. The notes payable requires an interest payment to be made every three months. The amount of
unrecorded accrued interest at December 31, 2013, is $1,875. The next interest payment. at an
amount of $2,250, is due on January 15, 2014.
d. Analysis of the unearned member lees account shows $5,800 remaining unearned at December 31 ,
20 13.
e. tn addition to the member fees Included in the revenue account balance, the company has earned
another S9,300 in unrecorded fees that will be collected on January 31, 2014. The company is also
expected to collect $10,000 on that same day for new fees earned in January 2014.
f. Depreciation expense for the year is S15.000.
Required :
1. Complete the six-column table by entering adjustments that reftect the above information. (Enter
member fees earned amount in the same order as they appear above.)
HAWKEYE RANGES
WOf1< Sheet
December 31, 2013
Unadjusted
Adjusted
Adjustments
T~Balance
Dr.
Account TiUe
1$
·Cash
Cr.
Dr.
Trial Balance
Cr.
Dr.
$
14,000
IAccounts receivable
Cr.
14,00o.,.I
x
Supplies
x
6,500
Equipment
3,000.,I
3,500.,I
135,000
Accumulated depreciation-Equipment
135,000.,I
$
30,000
15.000.,I
45,000.,/
Interest payable
1,875.,I
1,875.,I
ISalaries payable
1,200.,I
1,200.,I
Unearned member fees
15,000
tNotes payable
75.000
75,000.,/
P. Hawkeye, Capital
50,250
50,250.,I
,P. Hawkeye, Withdrawals
9,200.,I
5,800.,I
21,125
21,125.,I
IMember iees earned
42.000
60,500.,/
9.200.,/
9 ,300.,I
IDepreciation expense-Equipment
Salaries expense
t expense
1
1-Supplies expense
15,000.,/
15,000.,I
30,000
1.200.,/
31,20o.,.I
5.625
1,875./
7,500./
3,500.,/'
1$
Totals
1
212,250 1$
.
212,250
30.775
,$
2. Prepare journal entries for the adjustments entered in the six-column table for part 1.
General Journal
Date
dee. 31, 2013
Salaries expense
salaries payaf)le
dee. 31, 2013
Supplies expense
Supplies
dee. 31, 2013
Interest expense
Interest payable
dee. 31, 2013
Credit
Debit
.I
.I
1.200.,/
.I
.I
3.500.,I
.I
.I
1,875./
1,200.,I
+---=--!
3,500./
1,875.,I
9.200.,I
Unearned member fees
Member fees earned
dee. 31. 2013
dee. 31, 2013
9,200.,/
9,300.,I
Accounts receivable
Member fees earned
9,300.,I
Depreciation expense-Equipment
15,000.,I
Accumulated depreciation-Equipment
15,000.,/
---~
3. Prepare journal entries to reverse the effects of the adjusting entries that involve accruals. {If no
reversing entry is required, select "No reversing entry required.")
General Journal
Date
jan. 1. 2014
Debit
.I
Salaries payable
Salaries expense
jan. 1, 2014
No reversing entry required
jan. 1. 2014
Interest payable
Credit
1.200.,I
1,200.,/ 1
./
1,875.,I
!merest expense
jan. 1. 2014
1,875.,I
9,300.,/
Member fees earned
Accounts receivable
jan. 1, 2014
No reversing ento; required
jan. 1, 2014
' No reversing entry required
9 ,300.,I
+
_j
4. Prepare journal entries to record the cash payments and cash collections described for January.
(Assume reversing entries were prepared.)
General Journal
Date
jan. 4, 2014
Salaries expense
Cash
jan. 15, 2014
Interest expense
Cash
jan. 31, 2014
.Cash
Member fees earned
Debit
.I
.I
1.500.,I
.I
.I'
2.250.,/
Credit
l ,500.,I
2 ,250.,I
19,300.,I
19,300.,/
----
3.500.,/
$
40.075
s
230.325
$
239,625