Berdahl Company owns several retail outlets. During the year, it expanded operations and entered into the following transactions:Jan. 2Signed an eight-year lease for additional retail space for an annual rent of $25,400. Paid the first year's rent on this date. (Hint: Debit the first year's rent to Prepaid Rent.)Jan. 3Paid $24,800 to a contractor for installation of a new oak floor in the leased facility. The oak floor's life is an estimated 50 years with no salvage value.Mar. 1Paid $55,000 to obtain an exclusive area franchise for five years to distribute a new line of gourmet chocolates.June 1Paid $45,000 to LogoLab, Inc., for designing a trademark for a new line of gourmet chocolates that Berdahl will distribute nationally. Berdahl will use the trademark for as long as the firm remains in business. Berdahl expects to be in business for at least another 50 years.June 1Paid $27,000 for advertisement in a national magazine (June issue) introducing the new line of gourmet chocolates at the trademark. Requireda. Prepare journal entries to record these transactions.b. Prepare the necessary adjusting entries on December 31 for these transactions. Berdahl makes adjusting entries once a year. Berdahl uses straight-line depreciation and amortization.Round all answers to the nearest dollar.TransactionsDepreciation & AmortizationGeneral JournalDateDescriptionDebitCreditJan. 2AnswerAnswerAnswer AnswerAnswerAnswer To record payment of first year's rent on 8- year lease. Jan. 3AnswerAnswerAnswer AnswerAnswerAnswer To record payment for oak floor installation in leased facility Mar. 1AnswerAnswerAnswer AnswerAnswerAnswer To record acquisition of 5- year franchise. July 1AnswerAnswerAnswer AnswerAnswerAnswer To record payment for design of trademark. July 1AnswerAnswerAnswer AnswerAnswerAnswer To record payment for advertising. Please answer all parts of the question.

a. Journal entries: Date Particulars Debit Credit Jan 2 Prepaid rent $25,400 Cash…

Answered: Required a. Prepare journal entries to…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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Berdahl Company owns several retail outlets. During the year, it expanded operations and entered into the following transactions:

Jan. 2	Signed an eight-year lease for additional retail space for an annual rent of $25,400. Paid the first year's rent on this date. (Hint: Debit the first year's rent to Prepaid Rent.)
Jan. 3	Paid $24,800 to a contractor for installation of a new oak floor in the leased facility. The oak floor's life is an estimated 50 years with no salvage value.
Mar. 1	Paid $55,000 to obtain an exclusive area franchise for five years to distribute a new line of gourmet chocolates.
June 1	Paid $45,000 to LogoLab, Inc., for designing a trademark for a new line of gourmet chocolates that Berdahl will distribute nationally. Berdahl will use the trademark for as long as the firm remains in business. Berdahl expects to be in business for at least another 50 years.
June 1	Paid $27,000 for advertisement in a national magazine (June issue) introducing the new line of gourmet chocolates at the trademark.

Required
a. Prepare journal entries to record these transactions.
b. Prepare the necessary adjusting entries on December 31 for these transactions. Berdahl makes adjusting entries once a year. Berdahl uses straight-line depreciation and amortization.

Round all answers to the nearest dollar.

Transactions
Depreciation & Amortization

General Journal
Date	Description	Debit	Credit
Jan. 2	Answer	Answer	Answer
	Answer	Answer	Answer
	To record payment of first year's rent on 8- year lease.
Jan. 3	Answer	Answer	Answer
	Answer	Answer	Answer
	To record payment for oak floor installation in leased facility
Mar. 1	Answer	Answer	Answer
	Answer	Answer	Answer
	To record acquisition of 5- year franchise.
July 1	Answer	Answer	Answer
	Answer	Answer	Answer
	To record payment for design of trademark.
July 1	Answer	Answer	Answer
	Answer	Answer	Answer
	To record payment for advertising.

Please answer all parts of the question.

Expert Solution

Step 1

a. Journal entries:

Date	Particulars	Debit	Credit
Jan 2	Prepaid rent	$25,400
	Cash		$25,400
	(To record payment of first year's rent on 8- year lease)

Jan 3	Leasehold Improvements	$24,800
	Cash		$24,800
	(On capitalization of installation charges)

Mar 1	Franchise a/c	$55,000
	Cash		$55,000
	(On obtaining franchise)

June 1	Trademarks a/c	$45,000
	Cash		$45,000
	(On obtaining trademark)

June 1	Advertisement expenses	$27,000
	Cash		$27,000
	(To record advertisement expenses)

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Required a. Prepare journal entries to record these transactions. b. Prepare the necessary adjusting entries on December 31 for these transactions. Berdahl makes adjusting entries once a year. Berdahl uses straight-line depreciation and amortization. Round all answers to the nearest dolla