Cash Accounts Receivable Beg. bal. Beg. bal. Feb. 19b Feb. 2 Feb. 10a Feb. 1 Feb
ID: 2590571 • Letter: C
Question
Cash
Accounts Receivable
Beg. bal.
Beg. bal.
Feb. 19b
Feb. 2
Feb. 10a
Feb. 1
Feb. 26b
Feb. 6
Feb. 26a
Feb. 15d
Feb. 16
Feb. 18
Feb. 19a
Feb. 19b
Feb. 28
Feb. 26b
Feb. 17
End. bal.
End. bal.
0
Allowance for Doubtful Accounts
Inventory
Beg. bal.
Beg. bal.
Feb. 18
Feb. 26a
Feb. 5
Feb. 10b
Feb. 29b
Feb. 6
Feb. 15b
Feb. 15c
Feb. 17
End. bal.
End. bal.
Notes Receivable
Interest Receivable
Beg. bal.
Beg. bal.
Feb. 1
Feb. 29d
End. bal.
End. bal.
Accounts Payable
Unearned Revenue
Beg. bal.
Beg. bal.
Feb. 17
Feb. 5
Feb. 15a
Feb. 19a
Feb. 27
End. bal.
End. bal.
Wages Payable
Interest Payable
Beg. bal.
Beg. bal.
Feb. 29a
Feb. 29c
End. bal.
End. bal.
Notes Payable
Contributed Capital
Beg. bal.
Beg. bal.
End. bal.
End. bal.
Retained Earnings
Dividends Declared
Beg. bal.
Beg. bal.
CJE 2
CJE 1
Feb. 28
CJE 3
CJE 3
End. bal.
End. bal.
Sales Revenue
Sales Returns & Allowances
Beg. bal.
Beg. bal.
CJE 1
Feb. 10a
Feb. 15d
CJE 1
Feb. 15a
End. bal.
End. bal.
Sales Discounts
Cost of Goods Sold
Beg. bal.
Beg. bal.
Feb. 19b
CJE 1
Feb. 10b
Feb. 15c
Feb. 15b
CJE 2
End. bal.
End. bal.
Interest Revenue
Bad Debt Expense
Beg. bal.
Beg. bal.
CJE 1
Feb. 29d
Feb. 29b
CJE 2
End. bal.
End. bal.
Insurance Expense
Interest Expense
Beg. bal.
Beg. bal.
Feb. 2
CJE 2
Feb. 29c
CJE 2
End. bal.
End. bal.
Rent Expense
Utility Expense
Beg. bal.
Beg. bal.
Feb. 19a
CJE 2
Feb. 27
CJE 2
End. bal.
End. bal.
Wages Expense
Beg. bal.
Feb. 16
CJE 2
Feb. 29a
Cash
Accounts Receivable
Beg. bal.
Beg. bal.
Feb. 19b
Feb. 2
Feb. 10a
Feb. 1
Feb. 26b
Feb. 6
Feb. 26a
Feb. 15d
Feb. 16
Feb. 18
Feb. 19a
Feb. 19b
Feb. 28
Feb. 26b
Feb. 17
End. bal.
End. bal.
0
Allowance for Doubtful Accounts
Inventory
Beg. bal.
Beg. bal.
Feb. 18
Feb. 26a
Feb. 5
Feb. 10b
Feb. 29b
Feb. 6
Feb. 15b
Feb. 15c
Feb. 17
End. bal.
End. bal.
Notes Receivable
Interest Receivable
Beg. bal.
Beg. bal.
Feb. 1
Feb. 29d
End. bal.
End. bal.
Accounts Payable
Unearned Revenue
Beg. bal.
Beg. bal.
Feb. 17
Feb. 5
Feb. 15a
Feb. 19a
Feb. 27
End. bal.
End. bal.
Wages Payable
Interest Payable
Beg. bal.
Beg. bal.
Feb. 29a
Feb. 29c
End. bal.
End. bal.
Notes Payable
Contributed Capital
Beg. bal.
Beg. bal.
End. bal.
End. bal.
Retained Earnings
Dividends Declared
Beg. bal.
Beg. bal.
CJE 2
CJE 1
Feb. 28
CJE 3
CJE 3
End. bal.
End. bal.
Sales Revenue
Sales Returns & Allowances
Beg. bal.
Beg. bal.
CJE 1
Feb. 10a
Feb. 15d
CJE 1
Feb. 15a
End. bal.
End. bal.
Sales Discounts
Cost of Goods Sold
Beg. bal.
Beg. bal.
Feb. 19b
CJE 1
Feb. 10b
Feb. 15c
Feb. 15b
CJE 2
End. bal.
End. bal.
Interest Revenue
Bad Debt Expense
Beg. bal.
Beg. bal.
CJE 1
Feb. 29d
Feb. 29b
CJE 2
End. bal.
End. bal.
Insurance Expense
Interest Expense
Beg. bal.
Beg. bal.
Feb. 2
CJE 2
Feb. 29c
CJE 2
End. bal.
End. bal.
Rent Expense
Utility Expense
Beg. bal.
Beg. bal.
Feb. 19a
CJE 2
Feb. 27
CJE 2
End. bal.
End. bal.
Wages Expense
Beg. bal.
Feb. 16
CJE 2
Feb. 29a
Project 2: Review of Merchandising Cycle The following Information applles to the questions displayed below.] Wally's Widget Company (WWC) incorporated near the end of 2011. Operations began in January of 2012 WWC prepares adjusting entries ond financial statements ot the end of each month. Bolances in the occounts at the end of January are as follows: Cash Accounts Receivable Allowance for Doubtful Accounts Inventory (35 units) S 21,620 Uneamed Revenue (30 units) 12,650 Accounts Payable (Jan Rent) (1,900) Notes Payable 2,800 Contributed Copitel S 5,350 S 3.300 $16,000 Retained Earnings - Feb 1, 2012 S 3,520 ·WWC establishes a policy that it will sell inventory at $180 per unit. . In January, WWC received a $5,350 advance for 30 units, as reflected in Uneorned Revenue ·WWC's February 1 inventory balance consisted of 35 units at a total cost of $2.800 ·WWC's note payable accrues interest at a 12% annual rate WWC will use the FIFO inventory method and record COGS on a perpetual basis. February Transactions 02/01 Included in WWC's February 1 Accounts Receivable balance is a $1,400 account due from Kit Kat, a WWC customer. Kit Kat is having cosh flow problems ond cannot pay its balance at this time. Wwc arranges with Kit Kat to convert the $1,400 balance to a note, and Kit Kat signs a 6-month note, at 12% annual interest. The principal and all interest will be due and payable to wwC on August 1. 2012 02/02 wWC paid a $650 insurance premium covering the month of February. The amount paid is recorded 02/05 An additional 180 units of inventory are purchased on account by WWC for $13,500 - terms 2/15 02/05 wWC paid Federal Express $360 to have the 180 units of inventory delivered overnight. Delivery 02/10 Sales of 150 units of inventory occurred during the period of 02/07 02/10. The sales terms are 02/15 The 30 units that were paid for in advance and recorded in January are delivered to the customer. directly os an expense n30 occurred on 02/06 2/10, net 30 02/15 25 units of the inventory that had been sold on 2/10 are returned to WWC. The units are not damaged and can be resold. Therefore, they are returned to inventory. Assume the units returned are from the 2/05 purchase 02/16 wWC pays the first 2 weeks wages to the employees. The total paid is $2,800. 02/17 Paid in full the amount owed for the 2/05 purchase of inventory. WWC records purchase discounts in the current period rather than as a reduction of inventory costs. 02/18 Wrote off a customer's account in the amount of $2,000. 02/19 $6,600 of rent for January and February was paid. Becouse all of the rent will soon expire, the 02/19 Collected $10,000 of customers' Accounts Receivable. Of the $10,000, the discount was taken by 02/26 wWC recovered $600 cash from the customer whose account had previously been written off (see 02/27 A $950 utility bill for February arrived. It is due on March 15 and will be paid then. February portion of the payment is charged directly to expense customers on $8,000 of account balances; therefore WWC received less than $10,000 02/18). 02/28 wWC declared and paid a $950 cash dividend. Adjusting Entries: 02/29 Record the $2,800 employee salary that is owed but will be paid March 1 02/29 wwC decides to use the aging method to estimate uncollectible accounts. wwC determines 8% of the ending balance is the appropriate end of February estimate of uncollectible occounts. ued on the note payable 02/29 Record February interest expense occr 02/29 Record one month's interest earned Kit Kat's note (see 02/01).Explanation / Answer
Cash Account Date Account Titles Debit Credit Balance 1-Feb Openng balance 21620 2-Feb Insurance expense 650 20970 5-Feb Inventory (delivery) 360 20610 16-Feb Wages expense 2800 17810 Accounts Receivable Account Date Account Titles Debit Credit Balance 1-Feb Openng balance 12650 1-Feb Notes receivable 1400 11250 10-Feb Sales revenue 27000 38250 15-Feb Sales returns 4500 33750 Allowance for doubtful accounts Account Date Account Titles Debit Credit Balance 1-Feb Openng balance -1900 Inventory Account Date Account Titles Debit Credit Balance 1-Feb Openng balance 2800 5-Feb Accounts payable 13500 16300 5-Feb Cash 360 16660 10-Feb Cost of goods sold 11655 5005 15-Feb Cost of goods sold 1925 6930 Notes receivable Account Date Account Titles Debit Credit Balance 1-Feb Openng balance 1-Feb Accounts receivable 1400 1400 Accounts payable Account Date Account Titles Debit Credit Balance 1-Feb Openng balance 3300 5-Feb Inventory 13500 16800 Unearned revenue Account Date Account Titles Debit Credit Balance 1-Feb Opening balance 5350 15-Feb Sales revenue 5350 0 Sales revenue Account Date Account Titles Debit Credit Balance 10-Feb Accounts receivable 27000 27000 15-Feb Unearned revenue 5350 32350 Sales return & allowance Account Date Account Titles Debit Credit Balance 15-Feb Accounts receivable 4500 4500 Cost of goods sold Account Date Account Titles Debit Credit Balance 10-Feb Inventory 11655 11655 15-Feb Inventory 1925 9730 Insurance expense Account Date Account Titles Debit Credit Balance 1-Feb Openng balance 2-Feb Cash 650 650