Brothers Harry and Herman Hausyerday began operations of their machine shop (H &
ID: 2536123 • Letter: B
Question
Brothers Harry and Herman Hausyerday began operations of their machine shop (H & H Tool, Inc.) on January 1, 2013. The annual reporting period ends December 31. The trial balance on January 1, 2015, follows (the amounts are rounded to thousands of dollars to simplify): Account Titles Cash Accounts Receivable Supplies Land Equipment Accumulated Depreciation Software Accumulated Amortization Accounts Payable Notes Payable (short-term) Salaries and Wages Payable Interest Payable Income Tax Payable Common Stock Retained Earnings Service Revenue Salaries and Wages Expense Depreciation Expense Amortization Expense Income Tax Expense Interest Expense Supplies Expense Debit Credit 4 0 68 $ 7 24 6 0 0 83 0 0 0 Totals $111$111Explanation / Answer
Journal Entries required as below:
1.
Transaction
General Journal
Debit
Credit
1
Cash
13
Notes Payable
13
2
Land
7
cash
7
3
cash
128
Accounts Receivable
48
Service Revenue
176
4
cash
2
Common Stock
2
5
Salaries and Wages
93
cash
93
6
cash
32
Accounts receivable
32
7
Software
12
cash
12
8
accounts payable
14
cash
14
9
Supplies
17
accounts payable
17
10
No Journal Entry Required
11
Accumulated Amortisation
8
Software
8
12
Loss
17
Supplies
17
13
Depreciation
7
To Accumulated Depreciation
7
14
Accrued Interest
2
To Interest
2
15
No Journal Entry Required
16
Income tax expense
9
To Income Tax payable
9
ANSWER TO PART B:
POST CLOSING TRIAL BALANCE
POST CLOSING TRAIL BALANCE IS PREPARED BY TAKING EFFECT OF EACH JOURNAL ENTRY IN THE TRAIL.
Transaction
General Journal
Debit
Credit
1
Cash
13
Notes Payable
13
2
Land
7
cash
7
3
cash
128
Accounts Receivable
48
Service Revenue
176
4
cash
2
Common Stock
2
5
Salaries and Wages
93
cash
93
6
cash
32
Accounts receivable
32
7
Software
12
cash
12
8
accounts payable
14
cash
14
9
Supplies
17
accounts payable
17
10
No Journal Entry Required
11
Accumulated Amortisation
8
Software
8
12
Loss
17
Supplies
17
13
Depreciation
7
To Accumulated Depreciation
7
14
Accrued Interest
2
To Interest
2
15
No Journal Entry Required
16
Income tax expense
9
To Income Tax payable
9
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