The 2011 balance sheet of the Captain Jet Inc. is attached. During 2012, the following events occurred.
1. On January 10, sold merchandise on account to Rayms $9,000 and Fischer $8,600. Terms 2/10, n/30, F.O.B. shipping point.
2. On January 12, purchased merchandise on account from Zapfel $3,200 and Liotta $2,600. Terms 1/10, n/30, F.O.B. destination.
3. On January 14, received checks, $4,500 from Longhini and $2,500 from Hall, for sales on account after discount period has lapsed.
4. On January 15, send checks to Joosten for 9,000 less 3% cash discount, and to Maida for $10,000 less 2% cash discount.
5. On January 16, issued credit of $500 to Fischer for merchandise returned.
6. On January 21, paid off the balances to Zapfel and Liotta for the purchases on January 12.
7. On February 9, received payment in full from Rayms and Fischer.
8. On March 1, paid rent of $4,800 for a two-year term starting from May 1, 2013.
9. On April 1, the company CEO paid $49,999 from her savings bank account to purchase a car for personal use.
10. On April 12, paid $700 cash for office supplies.
11. Cash dividends totaling $1,000 were declared on June 13 and paid to stockholders on June 23.
12. Issued a note of $120,000 to bank (one year, annual interest rate 4%) for cash on July 1.
13. On July 5, purchased merchandise from Maida $32,000, terms 3/10, n/30.
14. On July 7, issued common stock 1000 shares, $10 par, in exchange of a land with a fair market value of $16,000.
15. On July 8, returned $300 of merchandise to Maida and received credit.
16. On August 1, sold merchandise to Lachey on account $80,000, term 1/10, n/30, F.O.B. shipping point.
17. Paid off the balance to Maida on August 4.
18. On Auguest 8, paid utilities expense, $10,209.
19. On August 18, Lachey paid off its balance.
20. On September 1, paid cash $7,500 to Farmington for merchandise purchased last year.
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21. On October 1, paid off notes payable $110,000 (issued in 2010) and associated interest $5,000 (including $1,500 interest payable on the balance sheet).
22. Over the year, daily cash sales were $16,500.
22. Over the year, sales and office employees earned $46,500 in salaries and wages, of which $2,500 remained as payable at the end of year.
23. On Dec 31, received an utilities bill of $1,250 (for December 2012) and paid off the bill on January 10, 2013.
Additional Information at the end of 2012:
1 .Depreciation expense for the year was $14,500.
2. The company estimated that it will pay federal income tax, $4,250.
3. After physically counting, the company decided that the ending inventories was $41,164.
4. Based on its historical data, the bad debts are about 1% of net credit sales.
5. Unearned revenue was decreased by $11,000.
6. The company expenses all of the supplies purchased during the year.
7. No insurance policy was effective during the year.
8. The company uses the gross method to record its purchases and sales on credit.
9. The company adopts the periodic inventory system.
10. Rayms, Fischer, and Lachey had zero balance on account as of Jan 1, 2012.
Instructions:
1. Prepare journal entries for each event.
2. Prepare adjusting entries.
3. Prepare adjusted trial balance.
4. Prepare Income Statement, Retained Earnings Statement, and Balance Sheet.
5. Prepare closing entries.
6. Please use Excel spread sheet (or similar spread sheet software) to complete the project.
7. Please email the completed project to [email protected]. A confirmation email will be sent once your file is received. Each group will submit one file.
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CAPTAIN JET INC.
BALANCE SHEET
DECEMBER 31, 2011
Current Assets
Cash
51,300
Notes Receivable
16,000
Accounts Receivable
41,800
Less: Allowance for Doubtful Accounts
(3,000)
Inventories
40,000
Prepaid Insurance
540
Prepaid Rent
500
Total Current Assets
147,140
Non-Current Assets
Long-term Investments
Investments in held-for-maturity securities
51,000
Land held for future development
45,500
Property, Plant, and Equipment
Land
85,000
Buildings
675,000
Less: Accumulated Depreciation
(187,500)
Intangible Assets
Capitalized Development Costs
8,000
Goodwill
76,000
Other Identifiable Intangible Assets
48,000
Total Non-Current Assets
801,000
Total Assets
948,140
Current Liabilities
Notes Payable
110,000
Accounts Payable
33,500
Unearned Revenues
12,000
Income Taxes Payable
9,440
Property Taxes Payable
6,600
Interest Payable
1,500
Total Current Liabilities
173,040
Non-Current Liabilities
Provisions Related to Pensions
93,100
Bonds Payable
300,000
Total Non-Current Liabilities
393,100
Total Liabilities
566,140
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Stockholders' Equity
Common Stock
100,000
Preferred Stock
100,000
Paid-in-capital - Common Stock
27,500
Paid-in-capital - Preferred Stock
10,000
Retained Earnings
152,250
Accumulated Other Comprehensive Income
5,000
Less: Treasury Stock
(12,750)
Total Stockholders' Equity
382,000
Total Liabilities and Stockholders' Equity
948,140
Project One: Check Figures
Please use the following check figures for the project one.
Adjusted Trial Balance: Total $1,289,061
Income Statement:
Earning after income tax: $2,894
Retained Earnings Statement:
Retained Earnings: $154,144
Balance Sheet:
Total assets: $947,134
Total liabilities: $547,240