. Dec 29 Girl Scouts sneak into the lot Friday night and start a campfire. The f
ID: 2556679 • Letter: #
Question
.
Dec 29 Girl Scouts sneak into the lot Friday night and start a campfire. The fire gets
out of control and destroys $1,800 worth of inventory. (To avoid
embarrassment to the Girl Scouts, the company does not file charges with the
police or make an insurance claim. Instead it asks the Girl Scouts to perform
200 hours of community service.) For accounting purposes, this would be considered a loss.
Dec 29 The Board of Directors declares a cash dividend of $.05 per share, payable in
January. (Hint: Use the dividends and dividends payable - common stock
accounts.) Verify that the amount of the dividends (the product of the number
of shares issued and the amount per share) equals $2,000.
Dec 30 This is the last payday for the month of December. The next payday will
occur in January. Payroll checks for the month of December total $5,248.
(For the time being you can ignore taxes. We will examine this topic later in
the course.)
Dec 31 Total sales on account for the month of December were $45,600. Beacon sold
all merchandise at a uniform selling price of $1.60 per board foot. (Hint: you
should be able to use this information to calculate the COGS entry by determining how many unites were sold.)
Dec 31 By the end of the month Beacon had collected cash payments from its account
holders of $37,600.
Journalize adjusting entries
Explanation / Answer
Dec-29 Abnormal Loss - Fire $1,800.00 Inventory A/c $1,800.00 (Loss of invnetory because of fire) Dec-29 Dividends $2,000.00 Dividends payable - common stock $2,000.00 (Dividend paid to 40000 share @ $ 0.05/share) Dec-30 Salaries A/c $5,248.00 Salaries Payable A/c $5,248.00 (Salaries due to be paid recorded) Dec-31 Accounts Receivables $45,600.00 Sales $45,600.00 (sales on accounts recorded) **In absence of info cant do entry of COGS) Dec-31 Cash $37,600.00 Accounts Receivables $37,600.00 (Cash received on accounts due)
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