The Chart of Accounts Number Name Normal Balance Debit Debit Debit Debit Debit D
ID: 2565684 • Letter: T
Question
The Chart of Accounts Number Name Normal Balance Debit Debit Debit Debit Debit Debit 1110 Cash 1120 Accounts Receivable 1130 Prepaid Insurance 1140 Prepaid Rent 1150 Office Supplies 211 Office Equip. 1212 Accum. Depr.-Office Equip. Credit 1311 Computer Equip. 1312 Accum. Depr.-Computer Equip. Credit 1411 Building Cost 1412 Accum. Depr.-Building 1510 Land 2101 Accounts Payable 2102 Advanced Payments 2103 Interest Payable 2105 Salaries Payable 2106 Income Taxes Payable 2201 Mortgage Payable 2202 Notes Payable 3100 Capital Stock 3200 Retained Earnings 3300 Dividends 3400 Income Summary 4100 Computer & Consulting Revenue Credit 5010 Rent Expense 5020 Salary Expense 5030 Advertising Expense 5040 Repairs & Maint. Expense 5050 Oil &Gas; Expense Debit Debit Credit Debit Credit Credit Credit Credit Credit Credit Credit Credit Credit Debit Credit Debit Debit Debit Debit Debit Debit Debit Debit Debit Debit 5080 Supplies Expense 5090 Interest Expense 5100 Insurance Expense 5110 Depreciation Expense 5120 Income Tax ExpenseExplanation / Answer
Below are the descriptions for the entries from number 1 to 25
1) Issue of common stock to Jeremy for cash and for computer equipment.
2) Issue of common stock to Courtney for cash, computer equipment and office equipment.
3) Took cash from Hashim Alghafli and in return Issues of common stock.
4) Purchase of additional computer equipment, down paid in cash and remaining balance to be via notes payable for five years.
5) Additional office equipment was purchase on credit from Discount computer corporation.
6) Return of office defective equipment to discount computer corporation adjusted against balance notes payable owed by byte.
7) Payment of outstanding amount in owed by Byte accounting to vendor in cash against purchase of computer equipment.
8) Payment towards insurance policy, period covering 1 year from June 16 for its computer equipment, in cash.
9) Cash received towards revenue from computer and consolation.
10) Purchase of Lang and building for $119,000, made down payment of $11,900 in cash for and remaining mortgaged payable in 8 equal instalments.
11) Advance rent for June and July was paid in cash.
12) Advertising expenses to be payable to local news paper agency.
13) Amount receivable from many customers for rendering consulting services.
14) Fax machine purchased for $725 and Payment was made in cash.
15) Outstanding payment of $560 was paid to vendors in cash.
16) Advertising expense paid to news paper agency.
17) Record of repair and maintenance expenses incurred towards repair of computer equipments is payable to vendor.
18) Salaries of $835 paid to equipment operators for the week ended June 18.
19) Cash of $3,765 received from debtors.
20) Purchase of additional office supplies on credit and same was capitalized.
21) Raised invoices to customers for consulting service performed.
22) Cash $5,201 received from debtors.
23) Repair and maintenance charges paid to vendor incurred on June 22.
24) Salaries of $835 paid to equipment operators for the week ended June 25.
25) Record for oil and gas expenses of $915 to be payable to vendor.
Below are the Journal entries from number 26 to 29
26) Dividend - Debit $1,232.33
2590 shares to Jeremy *.17 = $440.3
2459 Shares to Courtney *.17= $418.03
2200 shares to Hashim Alghafli *.17= $374
To Cash -Credit $1232.33
(record of dividend paid to 3 share holders)
27) On June 30th
Rent expenses - Debit $1,900
To Prepaid Rent - Credit $1,900
(record rent expenses for June month
28) On June 30th
Supplies expense - Debit $225
To Office Supplies - Credit $225
(record of closing supplied in the books as of June 30th)
29) On June 30
Interest Expense - Debit $379.31
$119,000-$11900 = $107,100
$107,100*8.5% = $9,103.5
for Half month = $9,103.5*.5/12
To Cash - Credit $379.31
(record interest on mortgage paid for half month from June16 to July 1)
30) On June 30th
Insurance Expenses - Debit $228
($5472/12 = $456, $456/.5 = $228)
To Prepaid Insurance - Credit $228
(record amortization for insurance charges for June month)
31) On June 30
Accounts Receivable - Debit $8,750
To Computer & consulting Revenue - Credit $8,750
(record un earned revenue for the period June 28-30)
32) On June 30th
Depreciation Expense - Debit $3,752.17
Office equipment $725+$700+$725-$140return & $450scrap/7years
Computer equipment $39,000+$12,000+$160,000)/ 5 years
Building $100,000-$18000(scrap value)/31.5 years
To Accumulated depreciation - Office equipment - Credit $216.93
To Accumulated depreciation - Computer equipment - Credit $3,516.67
To Accumulated depreciation - Building - Credit $18.57
(record depreciation expenses for one month)
33) On June 30
Salary expenses - Debit $501
To Salaries Payable - Credit $501
(record outstanding salary of $501 for three days, June 28-30)
34) On June 30
Interest Expense - Debit $1,031.33
$128,000*12%*8days/360 days = $341.33
$103,500*12% 20days/360 days = $690
To Interest Payable - Credit $1,031.33
(record interest payable on notes payable)
35) On June 30
Income tax expense - Debit $819.21
(refer income staarement)
To Income tax payable - Credit $819.21
(record income tax charges at 25% before tax)
Note: Assuming all the cash received from billings are pertaining to Same June month Revenue
36) On June 30
Computer consulting revenue - Debit $16,906
To Income Summary - Credit $16,906
(record closing entry for revenue account)
37) On June 30
Income Summary - Debit $13,629.14
To Dividends - Credit $1,232.33
To Rent expense - Credit $1,900
To Repairs & Maintenance expense - Credit $1,215
To advertising expense - Credit $250
To Depreciation expense - Credit $3,752.17
To Interest expense - Credit $1,410.64
To Salary expense - Credit $2,171
To Oil & gas expense - Credit $915
To Insurance expense - Credit $228
To Supplies expense - Credit $555
(record closing entry of expense accounts)
38) On June 30th
Income Summary - Debit $3,276.86
($16,906 - $13,629.14)
To Retained Earnings - Credit $3,276.86
(record closing entry for income summary account)
39) On June 30th
Retained Earnings - Debit $3,276.86
To Dividends - Credit $3,276.86
(record close of dividend account)
Please Note: 1) In case of multiple subparts only first 4 subparts needs be answered as a mandatory requirement and
2)In case of multiple questions only first full question with minimum 4 sub parts needs to be answered as a mandatory requirement.
Income Statement Revenues Conputer consulting revenue 16906 Total Revenues and Gains 16906 Expenses and Loses Dividends Paid 1,232.33 Rent expense 1,900.00 Repairs & maintenance 1,215.00 Advertising expense 250.00 Depreciation expense 3,752.17 Interest expense 1410.64 Salary expense 2,171.00 Oil & Gas 915.00 Insurance Expense 228.00 Supplies expense 555 Total Expenses and Loses 13629.14 Net Income 3276.86