Intermediate Accounting, 10 Ed
10th Edition
ISBN: 9781260310177
Author: Mark W. Nelson, Wayne B. Thomas J. David Spiceland
Publisher: McGraw-Hill Education
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Described below are certain transactions of Pharoah Corporation. The company uses the periodic inventory system.
On February 2, the corporation purchased goods from Martin Company for $68,100 subject to cash discount terms of 2/10,
n/30. Purchases and accounts payable are recorded by the corporation at net amounts after cash discounts. The invoice was
1.
paid on February 26
On April 1, the corporation bought a truck for $51,000 from General Mators Company, paying $5,000 in cash and signing a
one-year, 109% note for the balance of the purchase price.
2.
On May 1, the corporation borrowed SBB,600 from Chicago National Bank by signing a $97,720 zero-interest-bearing note
due one year from May 1.
3.
On August 1, the board of directors declared a $288,800 cash dividend that was payable on September 10 to stockholders of
record on August 31.
4.
Part 1
Your answer is partially correct.
L
Make all the journal entries necessary to record the transactions above using…
Vigeland Company completed the following transactions during Year 1. Vigeland’s fiscal year ends on December 31.
January 15
Purchased and paid for merchandise. The invoice amount was $15,200; assume a perpetual inventory system.
April 1
Borrowed $774,000 from Summit Bank for general use; signed a 10-month, 9% annual interest-bearing note for the money.
June 14
Received a $24,000 customer deposit for services to be performed in the future.
July 15
Performed $3,450 of the services paid for on June 14.
December 12
Received electric bill for $26,160. Vigeland plans to pay the bill in early January.
December 31
Determined wages of $15,000 were earned but not yet paid on December 31 (disregard payroll taxes).
Required:
Prepare journal entries for each of these transactions.
Prepare the adjusting entries required on December 31.
Transactions of Edwardson Corporation. The company uses the periodic inventory system.
On February 2, the corporation purchased goods from Martin Company for $70,000 subject to cash discount terms of 2/10, n/30. Purchases and accounts payable are recorded by the corporation at net amounts after cash discounts. The invoice was paid on February 26.
On April 1, the corporation brought a truck for $50,000 from General Motors Company, paying $4,000 in cash and signing a 1-year, 12% note for the balance of the purchase price
On May 1, the corporation borrowed $83,000 from Chicago National Bank by signing a $92,000 zero-interest-bearing note due 1 year from May 1
On August 1, the board of directors declared a $300,000 cash dividend that was payable on September 10 to stockholders of record on August 31.
Instructions: (A) Make all the journal entries necessary to record the transactions above using appropriate dates.
(B) Edwardson Corporations year-end is December 31. Assuming that no…
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- The following items were selected from among the transactions completed by Sherwood Co. during the current year: Mar. 1 Purchased merchandise on account from Kirkwood Co., $215,000, terms n/30. 31 Issued a 30-day, 6% note for $215,000 to Kirkwood Co., on account. Apr. 30 Paid Kirkwood Co. the amount owed on the note of March 31. Jun. 1 Borrowed $400,000 from Triple Creek Bank, issuing a 45-day, 8% note. Jul. 1 Purchased tools by issuing a $60,000, 60-day note to Poulin Co., which discounted the note at the rate of 6%. 16 Paid Triple Creek Bank the interest due on the note of June 1 and renewed the loan by issuing a new 30-day, 9% note for $400,000. (Journalize both the debit and credit to the notes payable account.) Aug. 15 Paid Triple Creek Bank the amount due on the note of July 16. 30 Paid Poulin Co. the amount due on the note of July 1. Dec. 1 Purchased equipment from Greenwood Co. for $320,000, paying $120,000 cash and issuing a series of ten 6% notes for…arrow_forwardNorthwest Sales had the following transactions in Year 1: The business was started when it acquired $58,500 cash from the issue of common stock. Northwest purchased $185,000 of merchandise for cash in Year 1. During the year, the company sold merchandise for $198,220. The merchandise cost $109,021. Sales were made under the following terms: a. Cash sales $48,870b. Credit card sales (The credit card company charges a $2.25 percent service fee.) $139,520c. Sales on account $9,830 The company collected all the amount receivable from the credit card company. The company collected $9,044 of accounts receivable. The company paid $40,927 cash for selling and administrative expenses. Determined that 3.75 percent of the ending accounts receivable balance would be uncollectible. Required Show the effects of each of the transactions on the elements of the financial statements, using a horizontal statements model. Use + for increase, − for decrease, and leave blank for not affected. In the…arrow_forwardThe following items were selected from among the transactions completed by Sherwood Co. during the current year: Mar. 1 Purchased merchandise on account from Kirkwood Co., $396,000, terms n/30. 31 Issued a 30-day, 4% note for $396,000 to Kirkwood Co., on account. Apr. 30 Paid Kirkwood Co. the amount owed on the note of March 31. Jun. 1 Borrowed $174,000 from Triple Creek Bank, issuing a 45-day, 4% note. Jul. 1 Purchased tools by issuing a $258,000, 60-day note to Poulin Co., which discounted the note at the rate of 7%. 16 Paid Triple Creek Bank the interest due on the note of June 1 and renewed the loan by issuing a new 30-day, 6.5% note for $174,000. (Journalize both the debit and credit to the notes payable account.) Aug. 15 Paid Triple Creek Bank the amount due on the note of July 16. 30 Paid Poulin Co. the amount due on the note of July 1. Dec. 1 Purchased equipment from Greenwood Co. for $400,000, paying $114,000 cash and issuing a series of ten 4% notes…arrow_forward
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