Question

Saved Brothers Harry and Herman Hausyerday began operations of their machine shop (H&H Tool, Inc) on January 1, 2016. The annual reporting period ends December 31. The trial balance on January 1, 2018, follows (the amounts are rounded to thousands of dollars to simplify): Account Titles Debit S 3 Credit Cash Accounts Receivable Supplies Land tquipment Accumulated Depreciation Software Accumulated Amortization Accounts Payable Notes Payable (short-term) Salaries and Wages Payable Interest Payable Income Tax Payable Common Stock Retained Earnings Service Revenue Salaries and iages Expense Depreciation Expense Amortization Expensee Income Tax Expense Interest Expense Supplies Expense 12 69 24 $113 $113 Totals * এ ও

Answer 1

H& H Tool, Inc. (Amount in '000) Journal Enteries Debit in $ Credit in $ Particulars Cash a/c To Note Payable Date 1.3.2018 Dr. 12. 12. (Being Note Payable issued) Land a/c Dr,. 2.3.2018 To Cash (Being Land purchased in cash) 8.12.2018 Cash a/c Dr. 129 Accounts Receivable a/c Dr. 49 To service revenue 178 (Being Revenue earned in cash and credit) Cash a/c 3.4.2018 Dr. 23 To Common Stock 23 (Being Common Stock issued for cash) Salaries and wages expense a/c Dr. 9.12.2018 94 To Cash 94 (Being salaries and wages paid in cash) 10.12.2018 Cash a/c Dr. 33 To Accounts Receivable 33 (Being Cash received from debtors) Software a/c 4.7.2018 Dr. 10 To Cash 10 (Being Software purchased for cash) 6.11.2018 Accounts Payable a/c Dr. 13 To Cash 13 (Being Accounts Payable paid in cash) 5.10.2018 Supplies a/c Dr. 18 To Accounts Payable 18 (Being Supplies purchased on account)

Adjusting Enteries Particulars 31.12.2018 Amortization on software a/c Dr. Debit in $Credit in $ Date 4 To accumulated amortization 4 (Being amortization of software charged to Software) 31.12.2018 Supplies Expense a/c Dr. 20 To Supplies (Being Supplies expense charged to Supplies) 20 31.12.2018 Depreciation a/c Dr. 6 To accumulated depreciation (Being Depreciation on equipment charged to Equip.) 31.12.2018 Interest Expense a/c Dr. 1 To Interest Payable 1 (Being Interest accrued on Note Payable) 31.12.2018 Salaries and wages expense a/c Dr 12 To Salaries and wages payable 12. (Being Salary Expense accrued) 31.12.2018 Income tax expense a/c To Income Tax Payable Dr. (Being Income tax accrued) Closing Enteries Particulars Debit in $ Credit in $ Date 31.12.2018 Income Summary a/c Dr. 153 To Salaries and wages expense 106 To Depreciation Expense To Amortization Expense To Income tax expense 16 To Interest Expense 1 To Supplies Expense 20 |(Being expense accounts closed 31.12.2018 Service Revenue a/c Dr. 178 To Income Summary 178 Being Revenue accounts closed 31.12.2018 Income Summary a/c To Retained Earnings (Being Income summary closed) Dr. 25 25

Adjusted Trial Balance For the period ending 31.12.2018 Post Closing Adjustment Unadjusted Debit in $ Credit in $ Debit in $ Credit in $ Debit in $ Credit in $ Debit in $ Credit in $ Adjusted Particulars Cash 74 74 74 Accounts Receivable 21 21 21 Supplies 30 20 10 10 land 9 9 Equipment 69 69 69 Accumulated depreciation 6 6 12 12. Software 34 34 34 Accumulated Amortization Accounts Payable 10 10 10 Notes Payable (short term) 12. 12 12. Salaries and wages payable 12 12 12. Interest Payable Income Tax Payable 1 1 16 16 Common Stock 113 113 113 Retained Earning 33 Service revenue 178 178 Salaries and wages expense 106 94 12. Depreciation Expense 6 Amortization Expense Income tax expense 16 Interest Expense 1 1 Supplies Expense 20 20 Totals 339 339 51 51 370 370 217 217 0 L o0

Statement of Income For the period ending 31.12.2018 Service revenue 178 Less: Salaries and wages expense 106 Depreciation Expense 6 Amortization Expense 4 Income tax expense 16 Interest Expense 1 Supplies Expense 20 153 Net Income 25 Statement of Retained Earnings For the period ending 31.12.2018 1.1.2018 Net Income 25 33

Balance sheet As at 31.12.2018 Amounts in $ Amounts in $ Liabilities Amounts in $ Amounts in $ Assets Current Liabilities Current Assets Accounts Payable Cash 74 10 Accounts Receivable Notes Payable (short term) 105 Salaries and wages payable 21. 12. Supplies 10 12. Interest Payable 1 Income Tax Payable Non Current Assets 16 51 land Shareholders equity Equipment 69 Accumulated deprecia 57 Common Stock -12 113 Retained Earning Software 34 33 146 Accumulated Amortiza -8 26 197 Total Liabilities & equity Total Assets 197