Question

aded hw problems - REQ'D A Saved C9-1 Accounting for Operating Activities (Including Depreciation) and Preparing Financial Statements (Chapters 3, 4, 8, and 9) [LO 3-3, 4-2, 8-29-2, 9-3) Grid Iron Prep Inc. (GIPI) is a service business incorporated in January of the current year to provide personal training for athletes aspiring to play college football. The following transactions occurred during the month ended January 31. a. GIPI issued stock in exchange for $100,000 cash on 1/01. b. GIPI purchased a gymnasium building and gym equipment on 102 for $50,000, 80% of which related to the gymnasium and 20% to the equipment. C. GIPI paid $260 cash on 1/03 to have the gym equipment refurbished before it could be used. d. GIPI provided $4,000 in training on 104 and expected collection in February e. GIPI collected $36,000 cash in training fees on 1/10, of which $34.000 related to January and $2,000 related to February f. GIPI paid $23,000 of wages and $7,000 in utilities on 1/30. 9. GIPI will depreciate the gymnasium building using the straight-line method over 20 years with a residual value of $2.000. Gym equipment will be depreciated using the double-declining balance method, with an estimated residual value of $2,250 at the end of its four-year useful life. Record depreciation on 3/31 equal to one-twelfth the yearly amount. h. GIPI received a bill on 131 for $350 for advertising done on 131. The bill has not been paid or recorded I. GIPI uses the aging method for estimating doubtful accounts and, on 1/31, will record an estimated 3 percent of its under 30-day-old accounts as not collectible. J. GIPI's income tax rate is 30%. Assume depreciation for tax is the same amount as depreciation for financial reporting purposes. Statement of General General Income Requirement Trial Balance Retained Balance Sheet Journal Statement Ledger Earnings Prepare journal entries to record the transactions and adjustments listed in (a)-(1). Review the accounts as shown in the General Ledger and Trial Balance tabs. (If no entry is required for a transaction/event, select "No Journal Entry Required in the first account Red Round your final answers to the nearest whole dollar amount.)

Answer 1

Journal entries to record the transactions and adjustments as follows: Account Titles and Explanations Credit Date Debit January 01, 2001 Cash $100,000 Common stock $100,000 January 02, 2001 Gym Building Gym Equipment $40,000 $10,000 Cash $50,000 January 03, 2001 Gym Equipment $260 $260 Cash January 04, 2001 Accounts receivable $4,000 Training revenue $4,000 January 10, 2001 Cash $36,000 $34,000 S2,000 Training revenue Unearmed revenue January 30, 2001 Wage expenses $23,000 Utilities expense $7,000 Cash $30,000

January 31, 2001 Depreciation expense $586 Accumulated depreciation (Gym [S10,000 $260) x50%] /12 Accumulated depreciation (Gymnasium (S586 - $428) equipment) $428 $158 January 31, 2001 Advertising expense $350 Accounts payable $350 January 31, 2001 Bad debt expense $120 $120 Allowance for doubtful debts January 31, 2001Income tax expense $2,083 Income tax payable $2,083