Transactions for December 20xx December 01 Borrowed $50,000.00 from North Bank b
ID: 2435422 • Letter: T
Question
Transactions for December 20xx
December 01
Borrowed $50,000.00 from North Bank by signing a 6%, 12 month note. Interest payments are due on
January 01 and July 01 throughout the life of the note.
December 01
Issued Check No. 5855 for $3,840.00 to Rainey Dae Insurance Company for a one-year insurance policy on
the building, effective January 01 next year.
December 01
Issued Check No. 5857 for $1,600.00 to Sterling Supply Company in exchange for office supplies.
December 01
Distributed the net salaries amount for the bi-weekly period ending 11/30/xx, which was accrued in
November, to employees via direct deposits.
ote: This entry should include a credit to the Cash account.
December 02
Issued Check No. 5858 for $4,500.00 to Xtreme Sports Magazine to run a two page advertisement for six
months, effective January 01 next year.
December 02
Issued Check No. 5859 for $1,727.18 to Portland Lending Bank for monthly mortgage payment: Interest
Payable for $ 643.85 and Mortgage Payable for $1,083.33.
December 03
Sold two XTRM - X23F ATVs to a cash customer for $6,500.00 each.
December 03
Billed customer A. Reece $565.24, for service work performed on his XTRM - X23F ATV. The costs of
parts and accessories totaled $367.41 (Invoice No. SA20123).
December 04
Received a check for $6,370.00 from customer C. Diaz as payment on her account, less discount (Invoice
No. SI18453).
8
December 04
Purchased ATV parts and accessories from supplier Dust Quest ATV Supply Company on account for
$1,365.25 (Invoice No. SP11653). Freight costs amounted to $24.50, with terms FOB destination.
December 07
Issued Check No. 5860 for $1,765.26 to purchase office equipment from P.N. Sill Equipment Company.
December 07
Issued Check No. 5861 for $27,300.00 to Winding Trail ATVs as payment on their account, less discount, on
a November 27 purchase of merchandise inventory (Invoice No. IP5676). The terms of the purchase were
2/15, n/60.
December 08
Sold on account three XTRM - X23F ATVs to customer S. Paulson for $6,500.00 each, terms 2/15, n/60
(Invoice No. S12861). The goods were shipped FOB destination point via carrier US Shipping Company.
The transportation costs will be paid later upon receipt of the invoice.
December 08
Exchanged an old truck and signed a $14,000.00 6%, 4 month note for a similar new truck. The old truck
had an original cost of $32,000.00, accumulated depreciation of $11,000.00, and a fair value of $21,000.00.
December 09
Issued Check No. 5862 for $475.29 to We Fix It Truck Repair Services for repair and maintenance work
performed on trucks.
December 09
Received a check for $6500.00, in exchange for the sale of one XTRM - X23F ATV.
December 10
Owner A. Marks withdrew $4,000.00 cash for personal use (Check No. 5864).
December 11
Purchased office furniture from Woodland Furniture, Inc., for $10,000.00 by signing a 6%, 5 month note.
December 11
Sold on account one XTRM - X23F ATV to customer S. Thompson for $6,500.00, terms 2/10, n/30 (Invoice
No. S12862). Freight costs amounted to $104.20, with terms FOB shipping point.
9
December 11
Issued Check No. 5865 for $201.23 to Portland Utilities Co. to pay the November 20xx utilities bill.
December 11
Issued Check No. 5866 for $1,365.25 to Dust Quest ATV Supply Company for ATV parts and accessories
purchased on December 04 (Invoice No. SP11653).
December 14
Granted customer S. Paulson credit for one XTRM - X23F ATV returned from the December 08 transaction
(Invoice No. S2861).
December 14
The bi-weekly payroll for the period ending December 14 is as follows:
Salaries:
Store Salaries $2,000
Office Salaries 4,080
Total $6,080
Witholdings:
FICA Taxes $547
Federal Income Tax Withholding 1,155
Total $1,702
Net Salaries $4,378
The payroll distribution of the net salaries amount is made to employees via direct deposits.
ote: The entry for the payment made to employees should include a credit to the Cash account.
December 14
The following represents the employer’s payroll taxes:
Payroll Taxes
FICA Taxes $547
Federal Unemployment Tax 36
State Unemployment Tax 243
Total $826
Payment of Payroll Taxes will be made to the appropriate government authorities next month.
10
December 15
Issued Check No. 5867 to the appropriate government authorities to pay for the prior month’s FICA Taxes
$1,094.00, Federal Income Tax Withholding $2,310.00, Federal Unemployment Tax $72.00, and State
Unemployment Tax $486.00.
December 15
Received a check for $754.54 from customer L. Walker as payment on his account (Invoice No. SA20122).
December 16
Purchased merchandise from supplier Quest ATVs on account for $16,900.00, terms 2/15, n/60 (Invoice No.
IP12003).
December 16
Received a check for $13,000.00 from customer H. Lincoln as payment on her account (Invoice No.
SI18452).
December 16
Issued Check No. 5868 for $12,223.12 to Dirty Trail ATVs as payment on their account, less discount, on a
November 30 purchase of merchandise inventory (Invoice No. IP2576). The terms of the purchase were
1/20, n/45.
December 17
Issued Check No. 5869 for $181.23 to US Shipping Company for payment of shipping costs incurred on the
December 08 sale to customer S. Paulson.
December 18
Returned and was granted credit for two XTRM - X23F ATVs purchased on December 16 from supplier
Quest ATVs. The total costs of the merchandise returned amounted to $8,450.00.
December 21
Purchased ATV parts and accessories from supplier ATV Supply Company on account for $2,500.23
(Invoice No. SP11983).
December 21
Received a check from S. Paulson as payment for the balance due from his purchase on December 08, less
discount (Invoice No. S2861).
December 21
Received a check from S. Thompson as payment for the net balance due from his purchase on December 11,
(Invoice No. S2862).
11
December 22
Issued check No. 5870 for $279.42 to US Shipping Company for payment of shipping costs incurred on
merchandise purchased.
December 23
Issued Check No. 5871 for $1,125.45 to ATV Supply Company as payment for ATV parts and accessories
purchased on account on November 23 (Invoice No. SP32653).
December 23
Issued Check No. 5872 for $4,671.99 to purchase a photocopy machine from OfficeThings.com, an
eBusiness.
December 28
Received a check for $873.25, for service work performed on a customer’s XTRM - X23F ATV. The costs
of parts and accessories totaled $567.61 (Invoice No. SA20123).
December 28
Sold on account two XTRM - X23F ATVs to customer P. Simon for $6,500.00 each, terms 2/10, n/30
(Invoice No. S12863).
December 28
The bi-weekly payroll for the period ending December 28 is as follows:
Salaries:
Store Salaries $2,000
Office Salaries 4,080
Total $6,080
Witholdings:
FICA Taxes $547
Federal Income Tax Withholding 1,155
Total $1,702
Net Salaries $4,378
The payroll distribution of the net salaries amount is made to employees via direct deposits.
ote: The entry for the payment made to employees should include a credit to the Cash account.
12
December 28
The following represents the employer’s payroll taxes:
Payroll Taxes
FICA Taxes $547
Federal Unemployment Tax 36
State Unemployment Tax 243
Total $826
Payment of Payroll taxes will be made to the appropriate government authorities next month.
December 29
Issued Check No. 5873 for $650.00 to purchase additional office supplies from Sterling Supply Company.
December 30
Received a check from customer A. Reece for service work performed on his XTRM - X23F ATVs on
December 03 (Invoice No. SA20123).
December 31
Received $19,500.00 from R. Morizio, a long standing customer, as an advance payment for two XTRM -
X23F ATVs to be held for him until January 15 next year, when he returns from his European vacation.
December 31
The Company hired Ms. Johanna Lopez as a Sales Clerk. It was agreed that she will be paid $600 per week,
and her starting date would be on Monday, January 04 next year.
1-Dec
Cash
50000
Notes Payable
50000
1-Dec
Prepaid Insurance
3840
Bank
3840
1-Dec
Supplies
1600
Bank
1600
 ...
1-Dec
Cash
50000
Notes Payable
50000
1-Dec
Prepaid Insurance
3840
Bank
3840
1-Dec
Supplies
1600
Bank
1600
1-Dec
Salaries Payable
Cash
2-Dec
Prepaid Advertising
4500
Cash
4500
2-Dec
Interest Payable
643.85
Mortgage Note Payable
1727.18
Cash
1727.18
3-Dec
Cash
13000
Sales Revenue
13000
3-Dec
Accounts Receivable
565.24
Sales and Service Revenue
565.24
3-Dec
Cost of Spare parts
367.24
Inventory of spare parts
367.24
4-Dec
Cash
6370
Accounts Receivable
6370
4-Dec
TV Parts and Accessories Inventory
1365.25
Accounts Payable
1365.25
7-Dec
Office Equipment
1765.26
Bank
1765.26
7-Dec
Accounts Payable
27857.14
Cash
27300
Discount Received
557.14
8-Dec
Accounts Receivable
19500
Sales and Service Revenue
19500
8-Dec
New Truck
35000
Accumulated Depreciation
11000
Old Truck
32000
Notes Payable
14000
9-Dec
Repair Services
475.29
Bank
475.29
9-Dec
Bank
6500
Services Revenue
6500
10-Dec
Drawings
4000
Cash
4000
11-Dec
Office Furniture
10000
Notes Payable
10000
11-Dec
Accounts Receivable
6500
Sales and Service Revenue
6500
11-Dec
Accounts Payable
201.23
Cash
201.23
11-Dec
Accounts Payable
1365.25
Cash
1365.25
14-Dec
Sales Returns
6500
Accounts Receivable
6500
14-Dec
Salaries Expense
6080
Salaries Payable
4378
Taxes Payable
1702
Salaries Payable
4378
Cash
4378
14-Dec
Tax Expense
826
FICA Taxes
547
Federal Unemployment Tax
36
State Unemployment Tax
243
15-Dec
Taxes Payable
3962
Cash
3962
16-Dec
Merchandise Inventory
16900
Accounts Payable
16-Dec
Cash
13000
Accounts Receivable
13000
17-Dec
Accounts Payable
12346.58
Cash
12223.12
Discount Received
123.46
17-Dec
Transportation Costs
181.23
Bank
181.23
18-Dec
Accounts Payable
8450
Merchandise Inventory
8450
21-Dec
Merchandise Inventory
2500.23
Accounts Payable
2500.23
21-Dec
Cash
6370
Discount Expense
130
Accounts Receivable
6500
22-Dec
Shipping Expenses
279.42
Shipping Expenses
279.42
23-Dec
Accounts Payable
125.45
Cash
125.45
23-Dec
Office Equipment
4671.99
Bank
4671.99
28-Dec
Bank
873.25
Sales and Service Revenue
873.25
28-Dec
Cost of Sales and Service Revenue
561.61
Parts and Accessories Inventories
561.61
28-Dec
Accounts Receivable
6500
Sales Revenue
6500
28-Dec
Salaries Expense
6080
Salaries Payable
4378
Taxes Payable
1702
28-Dec
Tax Expense
826
FICA Tax
547
Federal Unemployment Tax
36
State Unemployment Tax
243
29-Dec
Office Supplies
650
Bank
650
30-Dec
Bank
564.24
Accounts Receivable
564.24
31-Dec
Cash
19500
Unearned Sales and Service Revenue
Trial Balance on December 31, 20xx Is Below
Journalize and post adjusting journal entries at December 31, 20xx. (Note: Omit explanations for journal entries). Answer is below:
The journal entries to their respective accounts in the General Ledger and the Subsidiary Ledgers is below:
This Is A Journalize the December 20xx transactions for the Company in the General Journal. (Note: Omit explanations for journal entries).
Instruction:
Prepare the following financial statements:
A Multi-Step Income Statement for the year ended December 31, 20xx.
1-Dec
Cash
50000
Notes Payable
50000
1-Dec
Prepaid Insurance
3840
Bank
3840
1-Dec
Supplies
1600
Bank
1600
 ...
1-Dec
Cash
50000
Notes Payable
50000
1-Dec
Prepaid Insurance
3840
Bank
3840
1-Dec
Supplies
1600
Bank
1600
1-Dec
Salaries Payable
Cash
2-Dec
Prepaid Advertising
4500
Cash
4500
2-Dec
Interest Payable
643.85
Mortgage Note Payable
1727.18
Cash
1727.18
3-Dec
Cash
13000
Sales Revenue
13000
3-Dec
Accounts Receivable
565.24
Sales and Service Revenue
565.24
3-Dec
Cost of Spare parts
367.24
Inventory of spare parts
367.24
4-Dec
Cash
6370
Accounts Receivable
6370
4-Dec
TV Parts and Accessories Inventory
1365.25
Accounts Payable
1365.25
7-Dec
Office Equipment
1765.26
Bank
1765.26
7-Dec
Accounts Payable
27857.14
Cash
27300
Discount Received
557.14
8-Dec
Accounts Receivable
19500
Sales and Service Revenue
19500
8-Dec
New Truck
35000
Accumulated Depreciation
11000
Old Truck
32000
Notes Payable
14000
9-Dec
Repair Services
475.29
Bank
475.29
9-Dec
Bank
6500
Services Revenue
6500
10-Dec
Drawings
4000
Cash
4000
11-Dec
Office Furniture
10000
Notes Payable
10000
11-Dec
Accounts Receivable
6500
Sales and Service Revenue
6500
11-Dec
Accounts Payable
201.23
Cash
201.23
11-Dec
Accounts Payable
1365.25
Cash
1365.25
14-Dec
Sales Returns
6500
Accounts Receivable
6500
14-Dec
Salaries Expense
6080
Salaries Payable
4378
Taxes Payable
1702
Salaries Payable
4378
Cash
4378
14-Dec
Tax Expense
826
FICA Taxes
547
Federal Unemployment Tax
36
State Unemployment Tax
243
15-Dec
Taxes Payable
3962
Cash
3962
16-Dec
Merchandise Inventory
16900
Accounts Payable
16-Dec
Cash
13000
Accounts Receivable
13000
17-Dec
Accounts Payable
12346.58
Cash
12223.12
Discount Received
123.46
17-Dec
Transportation Costs
181.23
Bank
181.23
18-Dec
Accounts Payable
8450
Merchandise Inventory
8450
21-Dec
Merchandise Inventory
2500.23
Accounts Payable
2500.23
21-Dec
Cash
6370
Discount Expense
130
Accounts Receivable
6500
22-Dec
Shipping Expenses
279.42
Shipping Expenses
279.42
23-Dec
Accounts Payable
125.45
Cash
125.45
23-Dec
Office Equipment
4671.99
Bank
4671.99
28-Dec
Bank
873.25
Sales and Service Revenue
873.25
28-Dec
Cost of Sales and Service Revenue
561.61
Parts and Accessories Inventories
561.61
28-Dec
Accounts Receivable
6500
Sales Revenue
6500
28-Dec
Salaries Expense
6080
Salaries Payable
4378
Taxes Payable
1702
28-Dec
Tax Expense
826
FICA Tax
547
Federal Unemployment Tax
36
State Unemployment Tax
243
29-Dec
Office Supplies
650
Bank
650
30-Dec
Bank
564.24
Accounts Receivable
564.24
31-Dec
Cash
19500
Unearned Sales and Service Revenue
Explanation / Answer
DR Cash 50,000 CR Notes Payable 50,000
DR Prepaid Insurance 3,840 CR Cash 3,840
DR Salaries Payable CR Cash
DR Interest Payable 643.85 DR Mortgage Payable 1,083.33 CR Cash 1,727.18
DR Accounts Payable 27,300 CR Cash 27,300 (you don't say when the check was issued, so I don't know if the discount applies or not. If the discount applies, then the entry would be DR Accounts Payable 27,857.14 CR Cash 27,300.00 CR Purchases Discounts 557.14 )
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