Question

Answer all of these, please

C4-2 From Recording Transactions (Including Adjusting Journal Entries) to Preparing Financial Statements and Closing Journal Entries (Chapters 2, 3, and 4) [LO 2-3, LO 3-3, LO 4-1, LO 4-2, LO 4-3, LO 4-4, LO 4-5, LO 4-6] (General Ledger) Brothers Harry and Herman Hausyerday began operations of their machine shop (H & H Tool, Inc.) on January 1, 2016. The annual reporting period ends December 31, The trial balance on Januory 1, 2018, follows (the amounts are rounded to thousands of dollars to simplify) Debit Credit $ 3 5 Account Titles Cash Accounts Receivable 12 Supplies Land 60 Equipment Accumulated Depreciation Software Accumulated Amortization Accounts Payable Notes Payable (short-term) Salaries and Wages Payable Interest Payable Income Tax Payable $ 6 15 5 Common Stock Retained Earnings Service Revenue Salaries and Wages Expense Depreciation Expense Amortization Expense Income Tax Expense Interest Expense Supplies Expense $95 $95 Totals n un ooo o Transactions and events during 2018 (summarized in thousands of dollars) follow: a Borrowed $12 cash on March 1 using a short-term note. b. Purchased land on March 2 for future building site, paid cash, $9 c Issued additional shares of common stock on d Purchased software on July 4, $10 cash. e Purchased supplies on account on October 5 for future use, $18. fPaid accounts payable on November 6, $13 g Signed a $25 service contract on November 7 to start February 1, 2019. h Recorded revenues of $160 on December 8, including $40 on credit and $120 collected in cash Recognized salaries and wages expense on December 9, $85 paid in cash. Collected accounts receivable on December 10. $24. April 3 for $23 Data for adjusting journalentries as of December 31 k Unrecorded amortization for the year on software, $5. Supplies counted on December 31, 2018, $10 m Depreciation for the year on the equipment, $6 n Interest of $1 to accrue on notes payable. o Salaries and wages earned but not yet paid or recorded, $12 p Income tax for the year was $8. It will be paid in 2019 (Enter all of your answers in thousands of dollars. (i.e.., $100,000 should be entered as $100)). Statement of Retained Earnings General Ledger Income General Journal Balance Sheet Trial Balance Analysis Requirement Statement Prepare the journal entries to record transactions (a) through (). Then prepare the necessary adjusting entries (k) through (p) to correctly report net income for the perlod. Then record the closing entry as of December 31. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Statement of Retained Earnings General Income Analysis General Balance Sheet Trial Balance Requirement Statement Ledger Journal General Journal tab- Prepare the journal entries to record the transactions (a) through (). Review the accounts as shown in the General Ledger and Trial Balance tabs. Then prepare the necessary adjusting entries (k) through (p) to correctly report net income for the period. Then record the closing entry as of December 31. General Ledger tab Each journal entry is posted automatically to the general ledger. Use the drop-down button to the unadjusted, adjusted, or post-closing balances in the General Ledger. Trial Balance tab- You may view either the unadjusted, adjusted, or post-closing trial balance by choosing from the drop- down. Income Statement tab - Use the drop-down to select the accounts properly included on the income statement. The unadjusted, adjusted, or post-closing balances will appear for each account based on your selection. Statement of Retained Earnings tab- Prepare the statement of retained earnings for the year ended December 31, 2018. Balance Sheet tab- Use the drop-down to select the accounts to properly included on the balance sheet. The unadjusted, adjusted, or post-closing balances will appear for each account, based on your selection. Analysis tab-Calculate the Net Profit Margin and Current Ratio. vieyT General Journal Statement of Retained General Ledger Income General Balance Sheet Analysis Trial Balance Requirement Statement Journal Earnings Prepare the journal entries to record transactions (a) through (). Then prepare the necessary adjusting entries (k) through (p) to correctly report net income for the period. Then record the closing entry as of December 31. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View journal entryiworksheet View transaction list Debit Credit General Journal No Date Mar 01, 2018 Cash Notes Payable (short-term) Mar 02, 2018 Land 2 Cash Cash Apr 03, 2018 No Transaction Recorded Jul 04, 2018 4 General Ledger>

Answer 1

Step 1 Journal entry for Transaction for 2018 Particulars (S in 000s) Debit Credit Date $12 1-Mar-18 Cash Notes Payable (To Record borrowing of cash) $12 2-Mar-18 Land $9 $9 Cash To Record purchase of land) $23 3-Apr-18 Cash Common Stock $23 (To Record issue of common sck) 4-Jul-18 Software $10 Cash (To Record purchase of software) $10 5-Oct-18 Supplies $18 Accounts Payable (To Record purchase of supplies) $18 6-Nov-18 Accounts Payable $13 Cash ( To Record payment made) $13 7-Nov-18 No Entry No Entry (On signing of service contract) 8-Dec-18 Accounts Receivable Cash Service Revenue $40 $120 $160 (To Record sales) 9-Dec-18 Salaries and Wages Expense $85 $85 Cash (To Record salary expense) $24 10-Dec-18 Cash $24 Accounts Receivable (To Record payment received)

Step 2 Adjusting Entries (S in 000s) Particulars Debit Credit Date 31-Dec-18 Amortisation Expense S5 Accumulated Amortisation $5 (To Record Amortisation on sofware) 31-Dec-18 Supplies Expesne $20 Supplies (To Record supplies Expense) $20 31-Dec-18 Depreciation Expense Accumulated Depreciation $6 $6 (To Record Depreciation on Equipment) 31-Dec-18 Interest Expense $1 $1 Interest Payable (To Record interest accrue on notes payable) 31-Dec-18 Salaries and Wages Expense $12 Salaries and Wages Payable $12 (To Record interest accrue on notes payable) 31-Dec-18 Income Tax Expense $8 $8 Income Tax Payable (To Record income tax provision) Working Supplies Expense as on 01/01/2018 Supplies Opening $12 1 $18 Add: Purchases $30 Less: Closing as on 31/12/2018 ($10) $20 Supplies Expense

Step3 H and H Tool Inc (S in 000s) Trial Balance Adjusted Trail Balance Entry Adjustment January 1, 2018 Debit December 31, 2018 Debit Particulars Credit Debit Credit Credit Cash S3 $179 $117 $65 Accounts Receivable Supplies $5 $12 $40 $18 $24 $21 $10 $20 Land $0 S9 $0 $9 Equipment Accumulated Depreciation Software $60 S0 $0 $6 $60 $6 $0 $12 $15 $10 S0 $25 Accumulated Amortisation Accounts Payable Notes Payable Salaries and Wages Payable Interest Payable S5 S0 S5 $10 $5 $13 $18 $10 $0 $0 $12 $12 $0 $0 $0 $0 $12 $1 $12 $1 $0 $0 $8 $8 Income Tax Payable Common Stock Retained Earnings Service Revenue $71 $0 S0 $23 $0 $94 $8 8 S0 S0 $160 $160 Salaries and Wages Expense S0 $97 $0 $97 Depreciation Expense Amortisation Expense Interest Expense $0 $0 $6 $5 $0 S0 $6 $5 S0 $1 S0 $1 Income Tax Expense S0 $8 $20 S0 S0 $8 $20 Supplies Expesne S0 $95 $95 $406 $406 $327 $327

Step 4 H and H Tool Inc Income Statement For the year ended 31st December 2018 (S in 000s) Particulars Service Revenue Less: Operating Expense Amount Amount $160 $97 Salaries and Wages Expense $6 Depreciation Expense $5 Amortisation Expense Interest Expense $1 $20 Supplies Expesne (S129) tal Operating Expense Operating Income Less: Income Tax Expense Net Income $31 (S8) $23 Step 5 H and H Tool Inc Statement of Retained Earnings For the year ended 31st December 2018 (S in 000s) Particulars Retained Earnings at 1st January 2018 Net Income for the year ended 31st December 2018 Amount $8 $23 Retained Earnings at 31st December 2018 $31

Step 6 H and H Tool Inc Balance Sheet December 31, 2018 (S in 000s) Assets Liabilities Amount Amount Amount Cash $65 Accounts Payable $10 Accounts Receivable $21 Notes Payable $12 Supplies $10 Salaries and Wages Payable $12 Interest Payable $1 Income Tax Payable S8 $96 Total Current Liabilities Total Current Assets $43 $9 Shareholders' Equity Land Equipment Less: Accumulated Depreciation $60 $94 Common Stock ($12) Retained Earnings $31 $48 Total Shareholders' Equity $125 Software $25 Less: Accumulated Amortisation ($10) $15 Total Assets $168 Total Liabilities and Shareholder's Equity $168 Step 7 Net Income (S in 000s) $23 Net Profit margin (Net Income / Sales) [$23/$160] 14.4 % Step 8 The company is financed primarily by Shareholder's Equity. This is evident from the balance sheet. Liabilitis is $43 whereas Shareholders' Equity is 125 Step 9 Current Ratio Numerator $96 Current Assets 2.23 Denominator Current Liabilities $43