1. (28 points) The following list of accounts and their balances represents the
ID: 2581050 • Letter: 1
Question
1. (28 points) The following list of accounts and their balances represents the unadjusted trial balance of Alt Company at December 31, 2017: Cash Equity Investments (trading) Accounts Receivable Allowance for Doubtful Accounts $ 29,090 60,000 69.000 $ 500 54,720 36.000 160,000 Prepaid Rent Plant Assets Accumulated Depreciation-Plan Assets Accounts Payable Bonds Payable Common Stock Retained Earnings Sales Revenue Cost of Goods Sold Freight-Out Salaries and Wages Expense Interest Expense Rent Revenue Miscellaneous Expense Insurance Expense 14,740 11,370 90,000 170.000 214,800 0.0601auEco 154,400 11,000 32,000 2,040 nel le 21,600 890 $620.190 20.190 ditional Data The balance in the Insurance Expense account contains the premium costs of three policies eolicy4, remaining cost of $2,550, 1-yr. term, taken out on May 1, 2016; X Policy 2, orgnal cost of $7,200, 3-yr. term, taken out on Oct. 1, 2017; .200/36:200-s2wowh al cost of $1,300, 1-yr. tem, taken out on Jan. 1, 2017 On September 30, 2017, Alt received $21,600 rent from its lessee for an eighteen month lease beginning on that date. The regular rate of depreciation is 10% per year. Acquisitions and retirements during a year are depreciated at half this rate. There were no purchases during the year. On December 31, 2017, the balance of the Plant and Equipment account was S240.000-0%·a'o On December 28,2017, the bookkeeper incorrecty credited Sales for a receigt of cash on account in the amount of $20,000 At December 31, 2017, salaries and wages accrued but unpaid were $6,800 Alt estimates that 2% of sales will become uncollectible. 7) On August 1, 2017, Alt purchased, as a short-term investment, 60 $1,000, 7% bonds of Allen Corp. at par. The bonds mature on August 1, 2013. Interest payment dates are July 31 and January 31. 'K on April 30, 2017, Alt rented a warehouse for $3,000 per month, paying $36,000 in advance. Instructions Using journal paper or an Excel or similar spreadsheet, record the necessary correcting and adjusting entries BUS 223 Fall 17 Exam 1 Lois M. Darga, EdD, MBA, CPA, InstructorExplanation / Answer
Workings:
Alt Company Trial Balance as at December 31, 2017 Unadjusted Adjustments Adjusted Debit Credit Debit Credit Debit Credit Cash 29090 29090 Equity investments (Trading) 60000 60000 Accounts receivable 69000 20000 49000 Allowance for doubtful accounts 500 3896 4396 Inventory 54720 54720 Prepaid rent 36000 24000 12000 Prepaid insurance 6600 6600 Interest receivable 1750 1750 Plant assets 160000 160000 Accumulated depreciation - Plant assets 14740 20000 34740 Accounts payable 11370 11370 Salaries and wages payable 0 Unearned revenue 18000 18000 Bonds payable 90000 90000 Common stock 170000 170000 Retained earnings 97180 97180 Sales revenue 214800 20000 194800 Cost of goods sold 154400 154400 Freight out 11000 11000 Salaries and wages expense 32000 32000 Interest expense 2040 2040 Rent revenue 21600 18000 3600 Interest revenue 1750 1750 Miscellaneous expense 890 890 Insurance expense 11050 6600 4450 Depreciation expense 20000 20000 Bad debt expense 3896 3896 Rent expense 24000 24000 T o t a l 620190 620190 94246 94246 625836 625836Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.