Journal Entries- Adjusting Entries and Closing Entries

$10.00

  • Noncurrent Assets
  • Current Liabilities

 

SKU: ACC000898

Create a list of journal entries, adjusting entries and closing entries for below

Note: Round to the nearest dollar on all calculations before doing the journal entries. 

 Check Figure:  Total Assets on March 31, 2014 should be$33,407,196.

Dude Duds, Inc

Balance Sheet

December 31, 2013

EXCEL

 Dude Duds, IncTransaction ListFirst Quarter 2014

  1. Issued 360,000 shares of $1 par value common stock for $2,250,000on Jan 1.
  2. Dude Duds received $500,000when the company signed a promissory note with First Bank on Jan 2. Principle on the 0% note is due at the end of  12 years.
  3. Paid employee salaries and wages that were earned but remained unpaid at the end of last year on Jan 3.
  4. Collected the net balance of accounts receivable that were owed by customers at the beginning of the year.
  5. Paid for purchases made last year on account that remained unpaid at the beginning of the year.
  6. Acquired merchandise valued at $8,550,966on account.
  7. Acquired display fixtures with a list price of $481,400on Jan 7. Paid for fixtures on account.  The company expects the fixtures to have a useful life of 10 years and a salvage value of $48,140.
  8. Paid for freight charges and set-up of the display fixtures, $963.
  9. Discovered defective merchandise with a list price of $34,204. Returned the merchandise to the supplier.  Merchandise was originally purchased on account and the supplier agreed to credit the account.
  10. Obtained building and liability insurance coverage from Northwest Insurance Company. The two-year policy began on Feb 1 and has a premium of $54,000.  The previous 2-year premium was $52,800.
  11. Paid $5,130,579of merchandise invoices. The company deducted a 2% discount for prompt payment and treated the discount as a reduction in the acquisition cost of the inventory.
  12. Received an order from a customer for $158,727. The company expects to receive the merchandise from a supplier next month.  The customer advanced  $31,700 toward the contract price.
  13. Acquired new warehouse shelving costing $240,723on Feb 1. Dude Duds made a down payment of $84,253and assumed a 10-year, 3.5% mortgage for the balance.   The company expects the shelving to have a useful life of 5 years and a salvage value of  $12,000 .
  14. The firm purchased 100,000 shares of $1 par value common stock of ManMade Corporation for $1,996,040. This purchase is a short-term investment of excess cash.  ManMade Corp stock trades on the NYSE.
  15. Signed a contract for rental of office space beginning April 1. Paid rental for one year of $420,000in advance.   The rental payment is the same as last year.
  16. Sold merchandise with an original cost of $10,077,924for $17,636,367during the quarter. Of the total sales, 50% was for cash and the remainder was on account.
  17. Collected 75% of the sales made on account during this quarter.
  18. Employees earned $2,779,283in salaries and wages during this quarter, of which the company paid $2,084,462.
  19. Paid advertising and other selling expenses of $45,351.
  20. Paid all first quarter utility bills which totaled $50,390.
  21. Received dividends of $65,000from MadMade Corporation. Record as Investment Revenue.
  22. Declared and paid cash dividends of $0.25 per share to stockholders of record Feb. 28.
  23. Posted adjusting entries to correctly report current period expenses previously paid in advance.
  24. Depreciation on equipment & buildings purchased in prior periods was$47,497. The company uses the nearest full month to calculate depreciation expense on new purchases.
  25. Paid off $14,250 of notes. Interest accrued on all long-term debt was$9,640.
  26. Paid first quarter of income taxes. Dude Duds, Inc corporate tax rate is 15% on income before taxes.

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