Journal entries for accounting
Income Statement (previous month)
Sales Revenue 60,000
Cost of Goods Sold 12,000
Gross Profit 48,000
Salaries Expense 9,000
Bad Debt Expense 6,000
Rent Expense 7,000
Office Supplies Expense 3,000
Depreciation Expense 8,000 33,000
Operating Income 15,000
Gain on Sale of Equipment 3,000
Interest Expense (5,000) (2,000)
Net Income 13,000
Statement of Retained Earnings
(previous month)
Beginning Retained Earnings 40,000
Net Income 13,000
Dividends (3,000)
Ending Retained Earnings 50,000
Balance Sheet (previous month)
Assets Liabilities
Cash 53,000 Accounts Payable 9,000
Accounts Receivable 31,000 Salaries Payable 2,000
Allow For Doubtful Accts (3,000) Unearned Revenues 20,000
Office Supplies 7,000 Long-term Debt 27,000
Inventory 18,000 Total Liabilities 58,000
Prepaid Rent 48,000
Equipment 100,000 Equities
Accumulated Depreciation (35,000) Common Stock 111,000
Retained Earnings 50,000
Total Equities 161,000
Total Assets 219,000 Total Liab and Equities 219,000
I need help on these journal entries!! Thanks Guys!
Additional information at the BEGINNING of the month:
1. Inventory consists of 1,000 pairs of “Zips”, each costing $18. Zipparoo uses the LIFO inventory method. Round all inventory calculations to the nearest dollar.
2. The net method is used for recording purchases.
3. The Equipment of $100,000 was originally purchased 10 years ago. At that time, it was estimated that the equipment would have a useful life of 20 years and a salvage value of $30,000. Zipparoo uses the straight-line depreciation method.
4. Zipparoo uses the Income Statement method of accounting for bad debts.
5. Round all calculations to the nearest dollar.
Transactions during the month:
Jan. 1 Paid $2,400 for a one year premium on property and casualty insurance. The policy covers the period January 1, 2001 to December 31, 2002
Jan. 1 Sold 700 “Zips” to Joey on account for $60 each, terms 2/10, net 30.
Jan. 2 Zipparoo purchased additional equipment for cash for $23,000. The equipment has an expected life of 10 years and an estimated salvage value of $4,900.
Jan. 5 Joey returned 60 pairs of “Zips” because of defections. The inventory could not be resold and was disposed of.
Jan. 8 Purchased 600 pairs of “Zips” from Bluey on account for $20 each, terms 3/10, net 60.
Jan. 9 Office supplies totaling $7,300 were purchased on account.
Jan. 9 Joey paid full amount owed. Round calculations to the nearest dollar.
Jan. 12 Sold 700 pairs of “Zips” to Pete on account for $80 each, terms 2/10, net 30.
Jan. 14 Purchased 430 pairs of “Zips” from Kanga on account for $19 each, terms 2/10, net 30.
Jan. 17 Paid full amount owed to Bluey from Jan. 8 purchase.
Jan. 18 Paid $10,000 for workers’ salaries. This amount includes amounts owed from the previous month.
Jan. 23 Delivered 330 pairs of “Zips” to Flash who had purchased them in advance last month, $13,000.
Jan. 24 Paid interest on Long-Term Debt, $5,900.
Jan. 25 Paid dividends to stockholders, $3,900.
Jan. 26 Received cash from customers billed in the previous month, $10,000.
Jan. 27 Pete paid full amount owed.
Jan. 27 Paid full amount owed to Kanga from Jan. 14 purchase.
Jan. 28 One of Zipparoo’s customers, Rooth, owes $2,300 but has informed Zipparoo that he will not pay because of bankruptcy. Zipparoo writes off Rooth’s account as uncollectible.
Jan. 30 Paid utilities for January of $475.
