Question

Halogen Laminated Products Company began business on January 1, 2021. During January, the following transactions occurred:

 Halogen Laminated Products Company began business on January 1, 2021. During January, the following transactions occurred:

 Jan. 1 Issued common stock in exchange for $115,000 cash.

 2 Purchased inventory on account for $30,000 (the perpetual inventory system is used).

 Paid an insurance company $1,800 for a one-year insurance policy. Prepaid insurance was debited for the entire amount.

 10 Sold merchandise on account for $11,500. The cost of the merchandise was $6,500.

 15 Borrowed $25,000 from a local bank and signed a note. Principal and interest at 108 is to be repaid in six months.

 20 Paid employees $5,500 salaries for the first half of the month.

 22 Sold merchandise for $9,500 cash. The cost of the merchandise was $5,500.

 24 Paid $14,500 to suppliers for the merchandise purchased on January 2.

 26 Collected $5,750 on account from customers.

 28 Paid $1,000 to the local utility company for January gas and electricity.

 30 Paid $3, 500 rent for the building. $1,750 was for January rent, and $1,750 for February rent. Prepaid rent and rent expense were debited for their appropriate amounts.


 Required:

 1. Prepare general journal entries to record each transaction.

 2. Post the transactions into the appropriate T-accounts.

 3. Prepare an unadjusted trial balance as of January 30, 2021.


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Answer #1

Requirement 1:

Date Account title and Explanation Debit Credit
Jan.1 Cash $115,000
Common stock $115,000
[To record issuance of common stock]
Jan.2 Inventory $30,000
Accounts payable $30,000
[To record purchase of inventory on account]
Jan.4 Prepaid insurance $1,800
Cash $1,800
[To record cash paid in advance for insurance]
Jan.10 Accounts receivable $11,500
Sales revenue $11,500
[To record sales on account]
Cost of goods sold $6,500
Inventory $6,500
[To record cost of goods sold]
Jan.15 Cash $25,000
Notes payable $25,000
[To record borrowed from bank]
Jan.20 Salaries and wages expense $5,500
Cash $5,500
[To record payment of salaries and wages]
Jan.22 Cash $9,500
Sales revenue $9,500
[To record sales on account]
Cost of goods sold $5,500
Inventory $5,500
[To record cost of goods sold]
Jan.24 Accounts payable $14,500
Cash $14,500
[To record cash paid for accounts payable]
Jan.26 Cash $5,750
Accounts receivable $5,750
[To record cash collected from customers]
Jan.28 Utilities expense $1,000
Cash $1,000
[To record payment of utilities]
Jan.30 Rent expense $1,750
Prepaid rent $1,750
Cash $3,500
[To record payment of rent]

Requirement 2:

Cash Accounts receivable
Beg. Bal. $0 Beg. Bal. $0
Jan.1 $115,000 $1,800 Jan.4 Jan.10 $11,500 $5,750 Jan.26
Jan.15 $25,000 $5,500 Jan.20
Jan.22 $9,500 $14,500 Jan.24
Jan.26 $5,750 $1,000 Jan.28
$3,500 Jan.30
End. Bal. $128,950 End. Bal. $5,750
Inventory Prepaid insurance
Beg. Bal. $0 Beg. Bal. $0
Jan.2 $30,000 $6,500 Jan.10 Jan.4 $1,800
$5,500 Jan.22
End. Bal. $18,000 End. Bal. $1,800
Prepaid rent Accounts payable
Beg. Bal. $0 Beg. Bal. $0
Jan.30 $1,750 Jan.24 $14,500 $30,000 Jan.2
End. Bal. $1,750 End. Bal. $15,500
Notes payable Common stock
Beg. Bal. $0 Beg. Bal. $0
$25,000 Jan.15 $115,000 Jan.1
End. Bal. $25,000 End. Bal. $115,000
Service revenue Cost of goods sold
Beg. Bal. $0 Beg. Bal. $0
$11,500 Jan.10 Jan.10 $6,500
$9,500 Jan.22 Jan.22 $5,500
End. Bal. $21,000 End. Bal. $12,000
Salaries expense Rent Expense
Beg. Bal. $0 Beg. Bal. $0
Jan.20 $5,500 Jan.30 $1,750
End. Bal. $5,500 End. Bal. $1,750
Utilities expense
Beg. Bal. $0
Jan.28 $1,000
End. Bal. $1,000

Requirement 3:

HALOGEN LAMINATED PRODUCTS COMPANY
Unadjusted Trail Balance
January 30,2021
Account title Debit Credit
Cash $128,950
Accounts receivable $5,750
Inventory $18,000
Prepaid insurance $1,800
Prepaid rent $1,750
Accounts payable $15,500
Notes payable $25,000
Common stock $115,000
Service revenue $21,000
Cost of goods sold $12,000
Salaries expense $5,500
Rent expense $1,750
Utilities expense $1,000
Total $176,500 $176,500
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