Question

NEEDED INFORMATION

Service Price per hour provided: $96.00

Sales Price per unit of inventory sold: $84.00

Cost per unit of inventory sold: $38.75

Help needed only with (part 6) General ledger & Multi-step Income statement

Part 2 - General Journal (LO3-2) – Post the following journal entries to the general journal. | Trans.Date Description Dec. Sell 45,000 shares of no-par value common stock for $130,000 to obtain the funds necessary to start your business. Dec. Borrow $30,000 from the local bank and sign a one-year note. Interest and principal to be paid at maturity. The interest rate is 6%. Dec. Purchase equipment necessary for business operations for $25,000 cash. The equipment has a five-year life with a residual value of $4,000. Dec. Pay one year of rent in advance, $24,000 ($2,000 per month). 18-18-18-18-18-18 1 Dec. Purchased vehicle for $40,000. It has a 4-year useful life with residual value of $4,000. Purchase supplies on account, $1,000. w Dec. Purchase 300 units of inventory with cash. Dec. Provide 25 hours of services to customers for cash (calculate using your hourly 16 service rate) no terms specified. Dec. Sell 200 units of inventory on account. (Perpetual method = 2 entries) Dec. Sell 50 units of inventory to a customer on account with a sales discount of 2/10, 12 In/30. (Perpetual method= 2 entries) er Purchase an additional 300 units of inventory on account with terms 4/10 net 30. ADR Dec. The customer who purchased product on December 12th pays the amount due 20 (within discount period). Receive cash in advance for 25 hours of services to be completed in the future. 25 . Company pays invoice for inventory purchased on December 15th within discount terms. Sell 200 units of inventory to a customer who signs a 6-month promissory note at 10% interest for the balance due. (end of month so no interest would be accrued) perpetual method = 2 entries

This is the blank format for the general ledger and multi-step income statement

Answer 1

Part 6 :

Cash
1	130,000	3	25,000
2	30,000	4.	24,000
8.	2,400	5.	40,000
12.	4,116	7.	11,625
13.	2,400	14.	11,160
18.	38,000	16.	4,000
		17.	1,000
TB	90,131
Accounts Receivable
9.	16,800	12.	4,200
10.	4,200
TB	16,800
Allowance for Uncollectible Accounts
		TB	0
		Adj. 8	504
		ATB	504
Notes Receivable
15.	16,800
TB	16,800
Inventory
7.	11,625	9.	7,750
11.	11,625	10.	1,937.50
		14.	465
		15.	7,750
TB	5,347.50
Supplies
6.	1,000
TB	1,000
		Adj. 2	600
ATB	400
Prepaid Rent
4.	24,000
TB	24,000
		Adj. 1	2,000
ATB	22,000
Equipment
3	25,000
TB	25,000
ATB	25,000
Accumulated Depreciation
18.	750	18.	750
		TB	0
		Adj. 3	350
		ATB	350
Accounts Payable
14.	11,625	6.	1,000
		11.	11,625
		TB	1,000
		Adj. 5	300
		ATB	1,300
Deferred Revenue
Adj. 4	960	13.	2,400
		TB	2,400
		ATB	1,440
Interest Payable
		TB	0
		Adj. 6	150
		ATB	150
Salaries Payable
		TB	0
		Adj. 7	1,000
		ATB	1,000
Notes Payable
		2	30,000
		TB	30,000
Income Taxes Payable
		TB	0
		Adj. 9	2,674
		ATB	2,674
Common Stock
		1	130,000
		TB	130,000
		ATB	130,000
Dividends
17	1,000
TB	1,000
ATB	1,000
Service Revenue
		8.	2,400
		TB	2,400
		Adj. 4	960
		ATB	3,360
Sales Revenue
		9.	16,800
		10.	4,200
		15.	16,800
		TB	37,800
Sales Discounts
12.	84
TB	84
Cost of Goods Sold
9.	7,750
10.	1,937.50
15.	7,750
TB	17,437.50
Salaries Expense
16.	4,000
TB	4,000
Adj. 7	1,000
ATB	5,000
Supplies Expense
TB	0
Adj. 2	600
ATB	600
Depreciation Expense
18.	750
TB	750
Adj. 3	350
ATB	1,100
Rent Expense
TB	0
Adj. 1	2,000
ATB	2,000
Utility Expense
TB	0
Adj. 5	300
ATB	300
Bad Debt Expense
TB	0
Adj. 8	504
ATB	504
Interest Expense
TB	0
Adj. 6	150
ATB	150
Loss on Sale of Vehicle
18.	1,250
TB	1,250
ATB	1,250

Part 8:

Multi-Step Income Statement For the year ended December 31, 2019
Revenue
Service Revenue		$3,360
Sales Revenue	$37,800
Less: Sales Discount	(84)
Net Sales Revenue		37,716
Total Revenue		41,076
Less: Cost of Goods Sold		17,437.50
Gross Profit		23,638.50
Expenses:
Salaries Expense	5,000
Supplies Expense	600
Depreciation Expense	1,100
Rent Expense	2,000
Utility Expense	300
Bad Debt Expense	504
Total Operating Expenses		9,504
Income from Operations		14,134.50
Other Income / (Expenses or Losses )
Interest Expense	(150)
Loss on Sale of Vehicle	(1,250)	(1,400)
Income before taxes		12,734.50
Income Tax Expense ( 21 % )		2,674
Net Income		$ 10,060.50