Question

General journal, T Accounts, to adjusted trial balance with additional questions

Name Financial Statement Homework #3 Part At November 30, 2012. Silver Traders Company had the following trial balance. There is information on the next page about December 2012 transactions that need to be recorded Silver Traders Company Trial Balance 11 /12 287,000 62,000 24,000 6,000 65,000 195.000 75,000 44,000 45.000 46,000 15,000 Accounts Receivable Allowance for Doubtful Accounts Short Term Note Receivable Supplies Triventory Equipment Building Accumulated Depreciation Copyright Accounts Payable Dividends Payable Interest Payable Uncanned Revenue ST Note Payable LT Mortgage Payable Bonds Payable Premium on Bonds Payable Common Stock - $1 par Paid In Capital In Excess of Par-CS Preferred Stock - $5 par Paid In Capital In Excess of Par-PS Treasury Stock Retained Earnings Dividends Sales Revenue Sales Returns & Allowances Sales Discounts Cost of Goods Sold Bad Debts Expense Depreciation Expense Wages Expense Rent Expense Insurance Expense Supplies Expense Interest Revenue Interest Expense Gain on Sale of Equipment Income Tax Expense Total 200,000 26,840 3,000 86,000 1,000 50,000 105,000 5.000 819,000 3,840 9,000 380,000 5,000 50,000 260,000 63,000 16,000 6,000 1,000 8,000 15,000 4,000 1,492,840 1,492,840 Page 1 of 9

Answer 1

Joumalize entries as follows: | Credit General Journal Date Account name Dec 01, 2012 Building LT Mortgage payable (To record the purchase of building) Debit $150,000 $150,000 $6.000 Son Dec. 25, 2012 Cash Common Stock(500 x $1 par) Paid-in capital in excess of par- CS (500 x $11) (To record the issuance additional capital) SS SO $10,500 Dec. 29, 2012 Dividends (3000+500) < $3 per share] Dividends payable (To record the dividend on common stock) $10,500 $1,900 Dec 31, 2012 LT Mortgage payable Cash (To record the payment of first installment) $1.900

$1,000 Dec 31, 2012 Interest expense LT Mortgage payable ($150,000 x 8% x 1/12) (To record interest expense on LT Mortgage) $1,000 $200 Dec. 31, 2012 Interest expense Interest payable ($15,000 x 8%x 2/12) (To record interest expense on ST note) $200 $18,147 $1,853 Dec 31, 2012 Interest expense (See WN) Premium on bonds payable Cash (To record the interest and amortization expense) $20.000 $16,000 Dec 31, 2012 Unearned revenue Sales revenue (To record the revenue eamed during the month) $300 Dec 31, 2012 Preferred stock (50 x $5) Paid-in capital in excess ofpar-PS (50 x ($11-$5)] Treasury stock (To record purchase of its own preferred stock) $550 Working note:

Interest payable = $200.000 10% = $20.000 Value of bond on Jan 1, 2012 = $200,000+ $26.840 (premium on bond payable ) = $226,840 Effective interest rate = 8% Interest expense = $226,840 x 8% = $$18,147 Premium on bond payable debited = $20,000 - $18.147 = $1.853