Question

Meals-On-Demand Inc. is a company which delivers frozen meals directly to individuals' homes. Many customers purchase a month supply at one time. Customers usually pay for their orders as they are delivered but new customers must pay Meals-On-Demand Inc. in advance. Meals-On Demand Inc. prepares financial statements monthly. Meals-On-Demand Inc. had the following normal account balances at the beginning of October 2018, but these are not necessarily listed in good order: Name Cash Deferred Revenue Retained earnings Inventory Accounts payable Prepaid insurance (see Note below) Contributed capital Balance October 1, 2018 $11,000 1,800 5,950 10,500 2,000 2,250 14,000 Note: The prepaid insurance balance on October 1, 2018 relates to an annual insurance policy paid in full on July 1, 2018. The amount of the invoice was $3,000 and covers the period of July 1, 2018 - June 30, 2019. The following transactions occurred during the month of October 2018. Date Oct. 1 Oct 1 Oct. 8 Oct. 15 Oct. 22 Transaction Paid $2,250 to the landlord for the rental of the industrial unit occupied to carry out the business. The $2,250 paid consisted of rent of $750 per month for the period October 1, 2018 to December 31, 2018. Purchased refrigeration equipment for $10,000 by issuing a note payable. The note bears an annual interest rate of 6%. The note and interest are due in full on September 30, 2019. The refrigeration equipment replaced the equipment previously supplied by the landlord. Paid suppliers the $2,000 owed to them for inventory purchased in September. Received $1,400 from a new customer for meals to be delivered in November and December Meal-on-Demand Inc. negotiated a new type of contract with a retirement home and shipped $4,000 product to their location. The retirement home was invoiced for the shipment and it was agreed that the full amount will be paid in November. The cost of sales was $2,200. Purchased $4,500 inventory on account. Declared and paid a dividend of $2,000 to the shareholders of the corporation. Invoiced $7,800 for product delivered to individuals' homes in October. The cost of sales was $4,300. Of the $7,800 product invoiced, $6,800 was received in cash at the time of delivery and payment for the balance of the shipments had been received in September 2018. An invoice for delivery services for $500 for the month of October was received and the payment is due November 8, 2018. Wages for the two part-time employees amounted to $800 for the month. Of these wages $250 remained unpaid at the end of the month and the balance was paid. Recorded depreciation on the equipment of $250 and made other necessary month end adjusting entries. Income taxes on the profit for the month of October were estimated at $400. Oct. 23 Oct. 25 Oct. 27 Oct. 28 Oct. 31 Oct. 31 Required: Use the information provided to prepare journal entries to record all transactions and all necessary month end adjusting journal entries. You may use any reasonable account names for accounts not listed above that you require for any journal entry.

Answer 1

800 roo 6501 zoct wages Alcor 1 Towages Payable Al CBeing excpenses Recorded) Broct Wages Payable Alc.Dr 650 To cash | (Being wages paid) Bloct Deprceabon Alc or 250 To Equipmacool All 250 (Being Deph Recorded) Broct Tax Expenses Alc Dr 400 .. To Tax pay able Ale Being Expenses Recorded) Bloct. Interst Payable. Alcor - To Interst Payable (10,000 X6%XL C Being Expense Recorded on Due basis) 50

Joumal Entries Debit 750 ... 10,000 no 2000 2000 1-oct Rent Alc. Dr 750 To Cash (Being Rent Paida Toct Refreigerator Dr 10,000 - To cash CBeing Refregerator lurchased) Sroct Inventories Alcor gooo To cash Being inventories Purchased) 15-oct Cash Alo Dr 1400 To Seles CBeing Sale of Nor Recordeo) - 22-oct Debtoss AlcDr._ 4000 To Sales Looo C Being Sale to Retirment home Recorded) 23 oct Inventory Alc sr 4500 GOL To cash 4500 1 CBeing inventones Purchased) asoct! Dividena Paid Alcor 2000 To Cash 2000 C Being Dividenda Dishubered) Yoo