Question

Comprehensive Accounting Cycle Review 6

On December 1, 2017, Carla Vista Co. had the account balances shown below.

		Debits				Credits
Cash		$4,640		Accumulated Depreciation—Equipment		$1,380
Accounts Receivable		3,760		Accounts Payable		2,900
Inventory (2,700 x $0.50)		1,350		Common Stock		10,800
Equipment		19,400		Retained Earnings		14,070
		$29,150				$29,150

The following transactions occurred during December.

Dec. 3		Purchased 3,700 units of inventory on account at a cost of $0.78 per unit.
5		Sold 4,100 units of inventory on account for $0.90 per unit. (It sold 2,700 of the $0.50 units and 1,400 of the $0.78.)
7		Granted the December 5 customer $270 credit for 300 units of inventory returned costing $240. These units were returned to inventory.
17		Purchased 2,200 units of inventory for cash at $0.80 each.
22		Sold 2,100 units of inventory on account for $0.88 per unit. (It sold 2,100 of the $0.78 units.)

Adjustment data:

1.		Accrued salaries and wages payable $400.
2.		Depreciation on equipment $200 per month.
3.		Income tax expense was $200, to be paid next year.

Enter the December 1 balances in the ledger T-accounts and post the December transactions. (Post entries in the order of journal entries presented above.)

Answer 1

Sow fion On Dec 1,20, Caia vista co hod the accoont baionce Debi t $4,640 Cash Accounts Receivable $ 3,760 inventory $1,350 Casuipment 19,Lu00 $29,150 Eransactions doting December occo 1ed Dec 3, Por chased 3700 onits of invento an account a cost ofo-78 pei onit on accoun foi inen tary Soid of Dec 5 Luoo units Fo.90 per Unit

Adius ial baiance Credit Debit Cash $ २,४8० 9,028 A ccounts Receivable frventory eavuip ment $5,786 Accounts pavoable $,580 ACC Dep- eupment Saiartes payabie LOO Common Stoci 10,800 income tax pavable 200 Retained earning 14,070 Sates Yevernue 188 Saiarfes expen Ses Cost of goods Soid ,398 Saies Teturm 270 00 Depreciation income taxexpenses 200 $34,68 34,684

3 Decembey 5 CTanled the Sates Tetorn foy 300 Onits Cre dit Cos lome $ 270 is on eauip ment . pec 1, debi t g १,५०० Accured Salories & wag es paya bie is $ uoo fo1 AdSustment data Accomuate d deprecia tion -eauipment S ,380, foy adius tment data, depyecia tion on eauipmen 00 per mon th 1580 1,38020c S80 is A cCom laled. eauipment intome lox expense wa 20o Paid next yea