[The following information applies to the questions displayed below Vigeland Com
ID: 2557094 • Letter: #
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[The following information applies to the questions displayed below Vigeland Company completed the following transactions during Year 1. Vigeland's fiscal year ends on December 31. Jan. 15 Purchased and paid for merchandise. The invoice amount was $15,600; assume a perpetual inventory system. Apr. 1 Borrowed $740,000 from Summit Bank for general use; signed a 10-month, 10% annual interest-bearing note for the money. June 14 Received a $33,000 customer deposit for services to be performed in the future. July 15 Performed $3,350 of the services paid for on June 14. Dec. 12 Recelved electric bill for S27,360. Vigeland plans to pay the bill in early January. 31 Determined wages of $16,000 were earned but not yet paid on December 31 (disregard payroll taxes).Explanation / Answer
Journal Entries Date Account Title and explanation Debit Credit Jan, 15 Merchandise $ 15,600 To Cash $ 15,600 (T Record the purchase of merchandise) Cash $ 7,40,000 Apr, 01 To 10% Note $ 7,40,000 (To Record the purchase of 10% Note) Cash $ 33,000 June, 14 To Unearned Revenue $ 33,000 (Cash received for future service) Unearned Revenue $ 3,350 July , 15 To Revenue $ 3,350 (to Record the earned revenue ) Electric Expenses $ 27,360.00 Dec, 12 To Electricity Expenses Payable $ 27,360 (To Record the electricity Expenses) Dec, 31 Wages Expenses $ 16,000 To Wages Payable $ 16,000 (To Record the wages payable) Interest Expenses $ 55,500.00 Dec, 31 To Interest Payable $ 55,500 (To Record the interest payable for the year end) (Interest Amount = $ 740,000 X 10% X 9/12 = $ 55,500
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