Question

Question: Record the necessary journal entries for the year 2019. Show full calculations on the work! Please round the calculations to the nearest dollar and ignore the taxes.

Requirement 1 Record the necessary journal entries for the year 2019. Show full calculations on the work! Please round your calculated answers to the closest dollar and ignore taxes.

Answer 1

	In the Books Of General Products Inc.,
	Journal Entries
Date	Particulars	LF	Amount
Debit	Credit
1	TradeMarks A/c		45,000
	To Litigation Expenses A/c			45,000
	(Being Litigation expenses on TradeMarks, thereby increasing life of asset to 25 years from Date of acquisition)
	Amortisation of TradeMarks A/c		10,217
	To TradeMarks A/c			10,217
	(Being Amortisation of TradeMarks for the year ended 2019)
2	Accounts Receivable A/c		9,40,560
	To Sales A/c			9,40,560
	(Being Credit Sales)
3	Promotional Expense		990
	To Provision for Expenses A/c			990
	(Being provision made for Promotional expenses)
	Provision For Expenses A/c		935
	To Inventory of Premiums A/c			935
	(Being Expenses recognised for redeemed coupons)
	Provision For Expenses A/c		55
	To Promotional Expense A/c			55
	(Being Provision Reversal for Lapsed Coupons)
	Inventory of Premiums A/c		1,100
	To Accounts Payable A/c			1,100
	(Being Stock purchase for promotion)
6	Selling & Administrative expenses A/c		87,345
	To Bank A/c			87,345
	(Being expenses on Selling and admin)
	Depreciation A/c		30,000
	To Accumulated Depreciation A/c			30,000
	(Being Depreciation on PP&E)
7	Bank A/c		9,06,450
	To Accounts receivable A/c			9,06,450
	(Being Payments received)
8	Accounts Payable A/c		7,28,254
	To Bank A/c			7,28,254
	(Being Payment to Suppliers)
9	Purchases A/c		6,89,525
	To Accounts Payable A/c			6,89,525
	(Being Credit Purchases)
10	Land A/c		30,000
	To Bank A/c			30,000
	(Being Advance Paid for Land Purchase

Calculation of Amortisation of TradeMarks
Previous yearly amortisation
Acquisition Cost		2,00,000
Useful Life in Years		20
Amortisation		10,000
Value on Date		1,90,000
Value in Question		1,90,000
Difference		-
Additional Cost in 2019		45,000
New Useful life from DOA		25
Years elapsed		2
Remaining Life		23
Book value		1,90,000
Value for Amortisation		2,35,000
Amortisation for the year 2019	10,217
Value at year ended 2019		2,24,783
Calculation for computation of Promotional expense
Sales of Soap Powder Boxes in Nos.	6,000
Coupons per Soap Powder Box sale	1
Coupons given away		6,000
Expected redemption of coupons	60%
Provision to be created for Promotional expense ($1.10 per Coupon)	990
Coupons redeemed during year	3,400
Actual Expense ($1.10 per Coupon)	935
Calculation of Depreciation on PP&E
Historical Cost		7,50,000
Useful Life in Years		25
Yearly Straight-line depreciation	30,000