Vegas Verdes Inc. incorporated on 7/1/11 electing a June 30 FYE. On the same day Vegas Verdes issued common stock in exchange for $200,000 cash and a building worth $700,000. The building’s useful life is expected to be 20 years, the salvage value is $250,000 and straight-line depreciation is elected.

On 7/2/11, Vegas Verdes bought equipment for $212,000 by paying $52,000 cash and issuing a N/P for the remainder. The equipment has a three year useful life, a $20,000 salvage value and double-declining balance depreciation is elected.

During the year, Vegas Verdes provided services and billed clients $1,428,908. They collected $1,197,334 of these receivables and, on 6/30/12, they estimate they’ll collect about 92% of the remaining receivables

On 4/18/12, they received $150,000 in advance from a customer for a merchandise purchase. A week later they bought merchandise for $104,000 and delivered it to the customer satisfying the obligation.

During the year-ended 6/30/12, Vegas Verdes paid the following in cash: $560,345 salaries, $186,376 wages, $164,523 repairs and maintenance, $88,050 advertising, $44,000 dividends, $16,358 Misc. Exp and $11,668 interest on the N/P.

At 6/30/12, expenses incurred but not yet paid were: $24,763 salaries, $9,122 wages, $6,050 repairs and maintenance and $1,218 interest on the N/P.

Provide all journal entries

I charge $125 an hour for this sort of work