Question

Trail balance one including adjustments and one without

ra 1. March 1: Stockholder's invest $789,789 into the company in exchange f y in exchange for Billy common stock March 1: Billy Bob paid in advance for a 6-month paid $8,274 cash for the policy 2. insurance policy, which will begin today. He 3. March 1: Billy Bob purchased some land and a building for a total of $1.197,183 using $477.185 Based on the total purchase price of cash and then borrowing the rest from the bank. the land was $276,543 and the building was the remainder. The loan from the bank will be paid off over the next 16 years (1/16 of the principal will be paid off at the end of each year). The carries an interest rate of 9.22%. Interest accrued will be paid off at the end of every year. building has an expected life of 40 years and will be depreciated using the straight-line method. loan The March 2: Billy Bob purchased 15 bikes from Biker's Bargains. Each bike cost $2.960 and the credit terms are 4/15, n/30. (Note: Bikes are considered Inventory) 4. 5. March 2: Billy Bob paid FedEx $1,849 cash to ship the bikes he bought from Biker's Bargains. 6. March 4: Billy Bob purchased $2,751 worth of supplies from Oliver's Office Supplies paying cash. 7. March 5: Billy Bob sold 9 bikes to Carl's Cars for $8,750 each with credit terms of 2/10, n/30. The 8. March 5: Carl's Cars paid DHL $1,107 cash to ship the bikes he just bought. 9. total cost of the bikes was figured out to be $27,747. March 7: Billy Bob hires Biker Betty for promotional purposes. He estimates her salary to be $10/hour. She will probably work 10 hours this month. 10. March 10: Billy Bob paid off the balance due from Biker's Bargains. 11. March 11: Carl's Cars paid his balance off for the bikes he purchased. 12. March 12: Billy Bob's pay period ends and he now owes his employees $4,444 in salaries. These salaries will be paid on March 17h 13. March 14: Billy Bob purchased 17 more bikes from Biker's Bargains. Each bike cost $3.050 and 14. March 14: Billy Bob paid UPS $2,091 cash to ship the bikes he bought from Biker's Bargains. 15. the credit terms are 4/10 EOM, n/50. March 15: Billy Bob sold 12 bikes to Robbie Knievel for $9,150 each with credit terms of 3/10, n/30. The cost of the bikes was determined to be $37,536. 16. March 15: Billy Bob paid FedEx $1,489 to ship the bikes to Robbie Knievel.

Answer 1

Trial balance without adjustments

Billy Bob's Bikes
Trial Balance worksheet for the month of March
Account	Transactions		Unadjusted
	Debit	Credit	Debit	Credit
Cash	960039	647186	312853
Accounts Receivable	234105	188550	45555
Inventory	124272	87133	37139
Supplies	2751		2751
Prepaid Insurance	8274		8274
Land	276543		276543
Building	920640		920640
Acc. Depr - Building
Equipment	348304		348304
Acc. Depr. - Equipment
Accounts Payable	96250	113248		16998
Salaries payable	4444	4444		0
Interest payable
Income Tax Payable
Long Term Loan		1020000		1020000
Common Stock		789789		789789
Dividends	6666		6666
Sales		234105		234105
Sales returns and allowances	18300		18300
Cost of goods sold	81033	6346	74687
Freight out	1489		1489
Salaries Expense	4444		4444
Utilities Expense	3247		3247
Supplies Expense
Insurance Expense
Interest Expense
Depreciation Expense
Income Tax Expense
Total	3090801	3090801	2060892	2060892
Income Summary			0
Grand Total	3090801	3090801	2060892	2060892

Trial balance with adjustments

Billy Bob's Bikes
Trial Balance worksheet for the month of March
Account	Adjusted
	Debit	Credit
Cash	312853
Accounts Receivable	45555
Inventory	37139
Supplies	351
Prepaid Insurance	6895
Land	276543
Building	920640
Acc. Depr - Building		1918
Equipment	348304
Acc. Depr. - Equipment		4444
Accounts Payable		16998
Salaries payable		1577
Interest payable		6617
Income Tax Payable		36353
Long Term Loan		1020000
Common Stock		789789
Dividends	6666
Sales		234105
Sales returns and allowances	18300
Cost of goods sold	74687
Freight out	1489
Salaries Expense	6021
Utilities Expense	3247
Supplies Expense	2400
Insurance Expense	1379
Interest Expense	6617
Depreciation Expense	6362
Income Tax Expense	36353
Total	2111801	2111801
Income Summary	0
Grand Total	2111801	2111801
Depreciation Expense
Building:
Cost		920640
Estimated Life - years		40
Annual Depreciation		23016
Depreciation per month		1918
Equipment
Cost		348304
Salvage Value		55000
Depreciable Value		293304
Estimated Life - years		5.5
Annual Depreciation		53328
Depreciation per month		4444
Total Depreciation per month		6362
Interest Expense:
First Loan
Amount of loan		720000
Rate of interest		9.22%
Annual interest		66384
monthly interest		5532
Second Loan
Amount of loan		300000
Rate of interest		8.68%
Annual interest		26040
monthly interest		2170
Interest for march		1085
Total interest		6617