Accounting Cycle
The Swatch Group Limited (Swatch) is a publicly listed organization based in Switzerland. Swatch manufacturers and sells high quality watches. Swatch`s fiscal year end is December 31.
You have been hired by the Corporate Controller to provide assistance in accurately identifying and posting the adjusting entries necessary to ensure reliable financial statements are prepared for year end. You have also been asked to provide draft financial statements (see details noted below in the Required section).
Swatch’s account balances as of December 31, 2019 before adjusting entries are in Canadian dollars:
Accounts payable |
235,000 |
|
Accounts Receivable |
1,450,000 |
|
Accrued liabilities |
389,000 |
|
Accumulated depreciation-plant and equipment |
30,000 |
|
Advertising expense |
410,000 |
|
Allowance for doubtful accounts |
32,000 |
|
Bad debt expense |
20,000 |
|
Bonds payable |
1,300,000 |
|
Cash |
3,400,000 |
|
Common shares, 12,500 no-par shares issued |
3,500,000 |
|
Cost of goods sold |
770,000 |
|
Goodwill |
2,900,000 |
|
Intangible assets |
780,000 |
|
Interest expense |
270,000 |
|
Inventory |
470,000 |
|
Land |
3,340,000 |
|
Office expense |
620,000 |
|
Office Supplies |
7,000 |
|
Plant and equipment |
257,000 |
|
Prepaid insurance |
120,000 |
|
Retained earnings |
6,828,000 |
|
Salaries and wages expense |
1,700,000 |
|
Sales |
4,200,000 |
The Controller has provided the following information for year-end:
Required: Complete the following: (Hint: You may want to organize the unadjusted trial balance by element prior to setting up your T-accounts. Also, remember to transfer balances from the unadjusted trial balance to your T-accounts before starting.)
Respond to all the 5 required components and state any assumptions you have made in your responses. Please show all calculations.
Accounting Cycle The Swatch Group Limited (Swatch) is a publicly listed organization based in Switzerland. Swatch...
Accounting Cycle The Swatch Group Limited (Swatch) is a publicly listed organization based in Switzerland. Swatch manufacturers and sells high quality watches. Swatch's fiscal year end is December 31. You have been hired by the Corporate Controller to provide assistance in accurately identifying and posting the adjusting entries necessary to ensure reliable financial statements are prepared for year end. You have also been asked to provide draft financial statements (see details noted below in the Required section) Swatch's account balances...
Accounting Cycle The Swatch Group Limited (Swatch) is a publicly listed organization based in Switzerland. Swatch manufacturers and sells high quality watches. Swatch's fiscal year end is December 31. You have been hired by the Corporate Controller to provide assistance in accurately identifying and posting the adjusting entries necessary to ensure reliable financial statements are prepared for year end. You have also been asked to provide draft financial statements (see details noted below in the Required section). Swatch's account balances...
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