ra 1. March 1: Stockholder\'s invest $789,789 into the company in exchange f y i

Question

ra 1. March 1: Stockholder's invest $789,789 into the company in exchange f y in exchange for Billy common stock March 1: Billy Bob paid in advance for a 6-month paid $8,274 cash for the policy 2. insurance policy, which will begin today. He 3. March 1: Billy Bob purchased some land and a building for a total of $1.197,183 using $477.185 Based on the total purchase price of cash and then borrowing the rest from the bank. the land was $276,543 and the building was the remainder. The loan from the bank will be paid off over the next 16 years (1/16 of the principal will be paid off at the end of each year). The carries an interest rate of 9.22%. Interest accrued will be paid off at the end of every year. building has an expected life of 40 years and will be depreciated using the straight-line method. loan The March 2: Billy Bob purchased 15 bikes from Biker's Bargains. Each bike cost $2.960 and the credit terms are 4/15, n/30. (Note: Bikes are considered Inventory) 4. 5. March 2: Billy Bob paid FedEx $1,849 cash to ship the bikes he bought from Biker's Bargains. 6. March 4: Billy Bob purchased $2,751 worth of supplies from Oliver's Office Supplies paying cash. 7. March 5: Billy Bob sold 9 bikes to Carl's Cars for $8,750 each with credit terms of 2/10, n/30. The 8. March 5: Carl's Cars paid DHL $1,107 cash to ship the bikes he just bought. 9. total cost of the bikes was figured out to be $27,747. March 7: Billy Bob hires Biker Betty for promotional purposes. He estimates her salary to be $10/hour. She will probably work 10 hours this month. 10. March 10: Billy Bob paid off the balance due from Biker's Bargains. 11. March 11: Carl's Cars paid his balance off for the bikes he purchased. 12. March 12: Billy Bob's pay period ends and he now owes his employees $4,444 in salaries. These salaries will be paid on March 17h 13. March 14: Billy Bob purchased 17 more bikes from Biker's Bargains. Each bike cost $3.050 and 14. March 14: Billy Bob paid UPS $2,091 cash to ship the bikes he bought from Biker's Bargains. 15. the credit terms are 4/10 EOM, n/50. March 15: Billy Bob sold 12 bikes to Robbie Knievel for $9,150 each with credit terms of 3/10, n/30. The cost of the bikes was determined to be $37,536. 16. March 15: Billy Bob paid FedEx $1,489 to ship the bikes to Robbie Knievel.

Explanation / Answer

Trial balance without adjustments

Trial balance with adjustments

Billy Bob's Bikes Trial Balance worksheet for the month of March Account Transactions Unadjusted Debit Credit Debit Credit Cash 960039 647186 312853 Accounts Receivable 234105 188550 45555 Inventory 124272 87133 37139 Supplies 2751 2751 Prepaid Insurance 8274 8274 Land 276543 276543 Building 920640 920640 Acc. Depr - Building Equipment 348304 348304 Acc. Depr. - Equipment Accounts Payable 96250 113248 16998 Salaries payable 4444 4444 0 Interest payable Income Tax Payable Long Term Loan 1020000 1020000 Common Stock 789789 789789 Dividends 6666 6666 Sales 234105 234105 Sales returns and allowances 18300 18300 Cost of goods sold 81033 6346 74687 Freight out 1489 1489 Salaries Expense 4444 4444 Utilities Expense 3247 3247 Supplies Expense Insurance Expense Interest Expense Depreciation Expense Income Tax Expense Total 3090801 3090801 2060892 2060892 Income Summary 0 Grand Total 3090801 3090801 2060892 2060892

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