ACC 550
INTERMEDIATE ACCOUNTING I
PRINCIPLES REVIEW #2
SPRING SEMESTER I 2016
The
following transactions pertain to Ski Training Company for 2015:
· Jan 30 Established the business
when it acquired $75,000 cash from the issuance of common stock. · Feb
1 Paid rent for office space for two years, $24,000 cash.
· Mar 1 Borrowed $20,000 cash from
National Bank. The note issued had a 9% annual rate of interest and matures in
one year.
· Apr 10 Purchased $5,300 of
supplies on account.
· Jun 1 Paid $27,000 cash for a
computer system which had a three-year useful life and no salvage value.
· July 1 Received $50,000 cash in
advance for services to be provided over the next year.
· July 20 Paid $1,800 of the
accounts payable from April 10.
· Aug 15 Billed a customer $32,000
for services provided during August.
· Sep 15 Completed a job and
received $19,000 cash for services rendered.
· Oct 1 Paid employee salaries of
$20,000 cash.
· Oct 15 Received $25,000 cash
from accounts receivable.
· Nov 16 Billed customers $37,000
for services rendered on account
· Dec 1 Paid a dividend of $6,000
cash to the stockholders.
· Dec 31 Adjusted records to
recognize the amount of services provided on contract on July 1 (assume earned
ratably).
· Dec 31 Recorded the accrued
interest on the note to National Bank (see March 1).
· Dec 31 Recorded depreciation on
the computer system used in the business (see June 1).
· Dec 31 Recorded $4,500 of
accrued salaries as of December 31.
· Dec 31 Recorded the rent expense
for the year (see February 1).
· Dec 31 Physically counted
supplies; $480 was on hand at the end of the period.
REQUIRED:
(a)
Prepare journal entries for the transactions above. Use good form for the
journal entries.
(b)
Prepare a trial balance at December 31 based on the journal entries above.
(c)
Prepare an income statement for the year.
(d)
Prepare a statement of shareholders’ equity for the year.
(e)
Prepare a classified balance sheet as of the end of the year.
(f)
Prepare closing journal entries for the month.
(g)
Prepare a post-closing trial balance after making the closing entries above.
TUTORIAL
PREVIEW
|
(a) Journal
entries:
|
|||
|
Date
|
Account Title
|
Debit
|
Credit
|
|
30-Jan
|
Cash
|
75,000
|
|
|
Common Stock
|
75,000
|
||
|
01-Feb
|
Prepaid rent
|
24,000
|
|
|
Cash
|
24,000
|
||
File name: Ski Training Company.xlsx File type: .xlsx PRICE: $40
