Question

Accounts Receivaba Buildings Almance for Doubful Account Accumulated Depreciation Buildings Acumulated Depreciation Equipment Accounts Payable Salaries and was able Unnamed Rent Revenue Notes Pavable (due in 2016) Interest Prable Notes Parable due after 2016) Common Stock Retained Earnings Dividends 560 63.00 12.000 Continuin Debit Credit Sales Revenue 905.000 Interest Revenue Rent Revenue Gain on Disposal of Plant Assets Bad Debt Expense Cost of Goods Sold 630.000 Depreciation Expense Insurance Expense Interest Expense Other Operating Expenses 61.800 Amortization Expense -0- Salaries and Wages Expense 110,000 Total $1.167.400 $1.167,400 Unrecorded transactions 1. On May 1, 2015, Hassellhouf purchased equipment for $21.200 plus sales taxes of $1,600 (all paid in cash). 2. On July 1, 2015, Hassellhouf sold for $3.500 equipment which originally cost $5.000. Accumulated depreciation on this equipment at January 1, 2015, was $1,800: 2015 depreciation prior to the sale of the equipment was $450. 3. On December 31, 2015, Hassellhouf sold for $9.000 on account inventory that cost $6,300. 4. Hassellhouf estimates that uncollectible accounts receivable at year-end is $4.000. 5. The note receivable is a one-year, 8% note dated April 1. 2015. No interest has been recorded. 6. The balance in prepaid insurance represents payment of a $3,600 6-month premium on September 1, 2015. 7. The building is being depreciated using the straight-line method over 30 years. The salvage value is $30,000. 8. The equipment owned prior to this year is being depreciated using the straight-line method over 5 years. The salvage value is 10% of cost. 9. The equipment purchased on May 1, 2015. is being depreciated using the straight line method over 5 years, with a salvage value of $1,800 10. The patent was acquired on January 1, 2015, and has a useful life of 10 years from that date. 11. Unpaid salaries and wages at December 31, 2015, total $5,200 12. The uneared rent revenue of $6,000 was received on December 1, 2015. for 3 months rent. 13. Both the short-term and long-term notes payable are dated January 1, 2015, and carry a 9% interest rate. All interest is payable in the next 12 months.

1.prepare journal entries for transactions listed above

2. prepare an updated december 31, 20-5 trial balance

3 prepare a 2015 income statement and a retained earnings statement

4. prepare a december 31 2015 calified balance sheet

Answer 1

The journal entries for the first four subparts of Part 1 are as under:

Equipment (Debit)          $22,800

                To Cash/Bank (Credit)    $22,800

For purchase of equipment in cash

Cash/Bank (Debit)                                           $3,500

Accumulated depreciation (Debit)           $2,250

                To Equipment (Credit)                                   $5,000

                To Gain on sale of equipment (Credit)    $750

(For sale of equipment on gain)

Accounts receivable (Debit)        $9,000

                To Revenue (Credit)                       $9,000

(For sale on account)

Cost of goods sold (Debit)            $6,300

                To Inventory (Credit)                     $6,300

(To recognizing cost of goods sold on the above sale on account)

Bad debts expense (Debit)          $3,500

                To Allowance for doubtful debts (Credit)                              $3,500

(For creating provision for bad debts. $500 is already provided for earlier)

I am supposed to answer only the first 4 subparts of the first question. Please note for each additional (sub part) question you need to create separate questions.