Question

Silver Star Mountain Resort is a ski resort northeast of Vernon in British Columbia. Besides maintaining well-groomed ski runs, the company sells lift tickets, ski lessons, and ski equipment. It operates several restaurants and rents townhouses to vacationing skiers. The following hypothetical December 2017 transactions are typical of those that occur at the resort. points eBook a. Borrowed $610,000 from the bank on December 1, signing a note payable due in six months b. Purchased a new snowplow for $31.000 cash on December 31. c Purchased ski supplies for $15,500 on account. d. Incurred $33,000 in routine maintenance expenses for the chairlifts; paid cash. e Received $94.000 for season passes (beginning in the new year). Sold daily lift passes this month for a total of $98,000 cash. g. Received a $430 deposit on a townhouse to be rented for five days in January 2018. 15. Paid half the charges incurred on account in (c). 1. Paid $20,200 in wages to employees for the month of December Print References Required: 1-a. Prepare journal entries for each of the above transaction. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet 2 3 4 5 6 7 8 9 Borrowed $610,000 from the bank on December 1, signing a note payable due in six months. Note: Enter debits before credits. Transaction General Journal Debit Credit Record entry Clear entry View general journal

1-b. Calculate the company’s preliminary net income.

Answer 1

Journal entries

No	General Journal	Debit	Credit
1	Cash	610000
	Notes payable		610000
2	Equipment	31000
	Cash		31000
3	Supplies	15500
	Account payable		15500
4	Maintenance expense	33000
	Cash		33000
5	Cash	94000
	Deferred revenue		94000
6	Cash	98000
	Service revenue		98000
7	Cash	430
	Deferred revenue		430
8	Account payable	7750
	Cash		7750
9	Salaries expense	20200
	Cash		20200

b) Preliminary net income = 98000-53200 = 44800