Question

hampton ACCOUNTING SERVICE INC Dear Newbie, Welcome to Hampton! My name is Julio Antoni, your supervisor. We believe the best way for you to get familiar with what you are going to be doing here is to throw you right in, so we are asking you to start working on the books for us right away. For this project you will complete Hampton's entire accounting cycle. You will be required to record entries in a journal, post to a ledger, complete a trial balance, and prepare financial statements. Transactions will include day to day operations, adjusting entries, dividends and closing entries. All of the work will be completed in the provided Excel workbook (make sure you save the file on to your computer!) Company Information Hampton Accounting Service Inc. is a public corporation that has been in business for 1 year. The company is authorized to issue 100,000 shares of common stock at $1 par value. The company provides accounting services and sells accounting software. To date the company has issued 20,000 shares of common stock, which are still outstanding. The issued shares were sold at $10 per share. A building and furnishings were purchased at the start of the year. The cost of the building was $140,000 and the cost of the furnishings was $30,000. The depreciation will be recorded annually. The estimated useful life of the building is 20 years with a residual value of $10,000. The company uses the Straight line method to depreciate the building. The estimated useful life of the furnishings is 5 years with a residual value of $2,500. The company uses the Double Declining Balance method to depreciate furnishings. The current inventory consists of 30 units of software at a cost of $140.00 each. Inventory is costed using LIFO and the perpetual inventory system. The company uses an allowance method to account for uncollectible accounts. It is estimated that 1% of net credit revenue will be uncollectible, adjusted monthly. Employees are paid $2,500 salary twice a month, on the 16th for the first half of the month and on the 2nd of the following month for the last half of the month. Ignore income tax calculations. Project Requirements 1. Opening balances. The opening balances for select accounts are provided in the appropriate ledger accounts. 2. Record the following transactions in the journal and post to the ledger: 12/02/xx- Purchased 10 Units of Software on Account for $1,300 12/02/xx-Paid employees Salaries owed 12/02/xx- Provided Accounting Service on Account, $3,200 12/05/xx. Purchased Computer Equipment on Account, $4,800 Note: The equipment has an estimated useful life of 4 years, residual value of $50 and uses the DDB method.

Answer 1

ANSWER

As per the given question,

Date	Accounts and Explanation	Post Ref.	Debit	Credit
12/02/xx	Inventory	n/a	1300
	Accounts payable	n/a		1300
	(To record inventory purchased on account)
12/02/xx	Salary payable	n/a	2500
	Cash	n/a		2500
	(To record payment of salaries owed)
12/02/xx	Accounts receivable	n/a	3200
	Service revenue	n/a		3200
	(To record accounting services provided on account)
12/05/xx	Office equipment	n/a	4800
	Accounts payable	n/a		4800
	(To record computer equipment purchased on account)
12/08/xx	Supplies	n/a	800
	Cash	n/a		800
	(To record supplies purchased for cash)
12/10/xx	Cash	n/a	3000
	Accounts receivable	n/a		3000
	(To record collection on account)
12/11/xx	Accounts receivable	n/a	4500
	Sales revenue	n/a		4500
	(To record software sales on account)
12/11/xx	Cost of goods sold	n/a	2000
	Inventory	n/a		2000
	(To record the cost of the goods sold)
12/11/xx	Accounts payable	n/a	1000
	Cash	n/a		1000
	(To record payment on account)
12/12/xx	Inventory	n/a	2400
	Accounts payable	n/a		2400
	(To record inventory purchased on account)
12/14/xx	Advertising expense	n/a	250
	Cash	n/a		250
	(To record advertising bill paid)
12/15/xx	Cash	n/a	8000
	Service revenue	n/a		8000
	(To record accounting services provided for cash)
12/16/xx	Salary expense	n/a	2500
	Cash	n/a		2500
	(To record salaries paid)
12/17/xx	Accounts receivable	n/a	6000
	Service revenue	n/a		6000
	(To record accounting services provided on account)
12/19/xx	Accounts receivable	n/a	3000
	Sales revenue	n/a		3000
	(To record software sales on account)
12/19/xx	Cost of goods sold	n/a	1200
	Inventory	n/a		1200
	(To record the cost of the goods sold)
12/22/xx	Cash	n/a	2500
	Accounts receivable	n/a		2500
	(To record collection on account)
12/23/xx	Accounts payable	n/a	2500
	Cash	n/a		2500
	(To record payment on account)
12/24/xx	Utilities expense	n/a	850
	Cash	n/a		850
	(To record payment of utility bill)
12/27/xx	Cash	n/a	2000
	Unearned service revenue	n/a		2000
	(To record advance service revenue received)
12/29/xx	Cash	n/a	5000
	Service revenue	n/a		5000
	(To record accounting services provided for cash)
12/30/xx	Cash (1000 x $15)	n/a	15000
	Common stock (1000 x $1)	n/a		1000
	Additional paid in capital	n/a		14000
	(To record issuance of common stock)
12/31/xx	Retained earnings	n/a	31500
	Dividends payable (21000 x $1.50)	n/a		31500
	(To record dividends declared)

Working:

	Purchases			Cost of Goods Sold			Inventory on Hand
Date	QTY	Unit cost	Tot. Cost	QTY	Unit cost	Tot. Cost	QTY	Unit cost	Tot. Cost
Beg. Bal.							30	140	4200
12/02/xx	10	130	1300				30	140	4200
							10	130	1300
12/11/xx				10	130	1300
				5	140	700	25	140	3500
12/12/xx	20	120	2400				25	140	3500
							20	120	2400
12/19/xx				10	120	1200	25	140	3500
							10	120	1200
Totals	30		3700	25		3200	35		4700

THANK YOU FOR THE QUESTION......KINDLY RATE ...IT HELPS ME A LOT