Question

Hello there, just need some help with this multi-part accounting problem. Please correct what I've already filled in if you find any errors, and also please complete the rest by following the layout given. Thank you so much!

Grid Iron Prep Inc. (GIPI) is a service business incorporated in January of the current year to provide personal training for athletes aspiring to play college football. The following transactions occurred during the month ended January 31. 1. GIPl issued stock in exchange for $100,000 cash on 1/01. 2. GIPI purchased a gymnasium building and gym equipment on 1/02 for $50,000, 80% of which related to the gymnasium and 20% to the equipment. 3. GIPI paid $260 cash on 1/03 to have the gym equipment refurbished before it could be used. 4. GIPI provided $4,000 in training on 1/04 and expected collection in February 5. GIPI collected $36,000 cash in training fees on 1/10, of which $34,000 was earned in January and $2,000 would be earned in February GIPI paid $23,000 of wages and $7,000 in utilities on 1/30. 7. GIPI will depreciate the gymnasium building using the straight-line method over 20 years with a residual value of $2,000. Gym equipment will be depreciated using the double-declining-balance method, with an estimated residual value of $2,250 at the end of its four-year useful life. Record depreciation on 1/31 equal to one-twelfth the yearly amount. 8. GIPI received a bill on 1/31 for $350 for advertising done on 1/31. The bill has not been paid or recorded. 9. GIPI uses the aging method for estimating doubtful accounts and, on 1/31, will record an estimated 3 percent of its under 30 day-old accounts as not collectible. 10.GIPI's income tax rate is 30%. Assume depreciation for tax is the same amount as depreciation for financial reporting purposes. Requirement General Journal General Ledger Trial Balance Income Statement Statement of Retained Earnings Balance Sheet Prepare journal entries to record the transactions and adjustments listed in (1)-(10). Review the accounts as shown in the General Ledger and Trial Balance tabs. Round your answers to nearest whole dollar. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list View journal entry worksheet General Journal Credit No 1 Date Jan 01 Debit 100,000 Cash Common Stock 100,000 2 Jan 02 Building Equipment Cash 40,000 10,000 50,000 Jan 03 260 Equipment Cash 260 < Requirement General Ledger >

Answer 1

Grid Iron Prep Inc. Journal Enteries Trans. Particulars Cash a/c Dr. To Common Stock (Common Stock issued) Debit in $ Credit in $ 100000 100000 b. Dr. Dr. 40000 10000 Building a/c Equipment a/c To Cash (Assets purchased) 50000 260 Equipment a/c Dr. To Cash (Equipment refurbished) 260 d. 4000 Accounts Receivable a/c Dr. To Training Revenue (Revenue on account) 4000 Dr. 36000 Cash a/c To Training Revenue To Unearned Revenue (Cash fro services) 34000 2000 Dr. Dr. 23000 7000 Wages Expense a/c Utilities Expense a/c To Cash (Expense paid) 30000 Adjusting Enteries Trans. Particulars Depreciation a/c Dr. To Accumulated Depreciationn - Build (Being depreciation charged to asset) (44800 - 5000 )/(20 x 12) = 158 Debit in $ Credit in $ 158 158 428 428 Depreciation a/c Dr. To Accumulated Depreciationn - Equip (Being depreciation charged to asset) (10000 + 260 ) x 2 x 1/4 x 1/12 = 428 h. Dr. 350 Advertising Expense a/c To Accounts Payable (Expense accrued) 350 120 120 Bad Debts a/c Dr. To Allowance fro Doubtful accounts (Bad debts estimated) 4000 x 3% Dr. 2083 Income Tax Expense a/c To Income Tax Payable (Income tax accrued) 2083

Worksheet For the period ending January 31 Particulars Cash Accounts Receivable Allowance for Doubtful accounts Building Accumulated Depreciationn - Build Equipment Accumulated Depreciationn - Equip Accounts Payable Unearned Revenue Income Tax Payable Common Stock Training Revenue Wages Expense Utilities Expense Depreciation Advertising Expense Bad Debts Income Tax Expense Totals Unadjusted Adjustments Adjusted Debit in $ Credit in $ Debit in $ Credit in $ Debit in $ Credit in $ 55740 55740 4000 4000 120 120 40000 40000 158 158 10260 10260 428 428 350 350 2000 2000 2083 2083 100000 100000 38000 38000 23000 23000 7000 7000 586 350 350 120 120 2083 2083 140000 140000 3139 3 139 143139 143139 38000 Statement of Income For the period ending January 31 Training Revenue Less: Wages Expense Utilities Expense Depreciation Advertising Expense Bad Debts 23000 7000 586 350 120 31056 6944 -2083 4861 Income Tax Expense @ 30% Net Income Statement of Retained Earnings For the period ending January 31 Net Income 4861

Amounts in $ Amounts in $ Balance sheet As at Jan 31 Assets Amounts in $ Amounts in $ Liabilities Current Assets Current Liabilities Cash 55740 Accounts Payable Accounts Receivable Unearned Revenue Allowance for Doubtfu 59620 Income Tax Payable 4000 350 2000 2083 -120 4433 40000 - 158 Non Current Assets Building Accumulated Deprecia Equipment Accumulated Deprecia Total Assets 10260 -428 39842 Shareholders Equity Common Stock 100000 9833 Retained Earnings 4861 109294 Total Liabilities & Shareholders Eq. 104861 109294