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ACT210 Spring 2014 Final Project

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Question;1. Enter the post-closing trial balance amounts into T-accounts from the Midterm ProjectCash--$58,575Note Payable--$30,000Supplies-- $300Interest Payable--$625Prepaid Insurance--$1800Retained Earnings--$24,050Equipment--$31,000Common Stock--$30,000Accumulated Depreciation--$7,0002. Add the following T-accounts with zero opening balances:Accounts ReceivableAllowance for Uncollectible AccountsInventoryVehiclePrepaid RentAccounts PayableSales Tax PayablePayroll Taxes PayableNote Payable ? VehicleSales RevenueSales DiscountsService Revenue (clinics/ races)Cost of Goods SoldSalaries ExpensePayroll Tax ExpenseInterest ExpenseInsurance ExpenseRent ExpenseDepreciation ExpenseBad Debts ExpenseBank Service Charge ExpenseSupplies ExpenseCheck Figures: Cash: $84,995/ Balance Sheet-Current Liabilities: $11,245NOTE: You may be one or two dollars different depending on rounding. This is OK!3. Journalize and post the following transactions for the 1st quarter of 2013:Although the clinics and races have been successful, Tony and Suzie decide to expand the business by selling heart-rate monitor watches. They agree to use the FIFO method of accounting for their inventories.a. On January 1st, Great Adventures pays $6,000 for January-June rent. ($1,000 per month)b. On January 3rd, purchased 40 watches for $2000 ($50 per watch) on account, terms 2/10, n/30.c. On January 5th, returned 10 of the watches purchased on January 3rd.d. On January 7th, sold 20 watches for $3,000 on account to The Human Race, terms 4/10, n/30.e. On January 12th, paid for the watches purchased on January 3rd.f. On January 14th, received payment from the Human Race for the sale on January 7th.g. On January 18th, purchase $1200 of supplies with cash.h. January 31st, pay Victor?s salary of $3,000, less $450 federal and state income tax withholding and $230 FICA withheld. Accrue employer?s FICA of $230 and federal and state unemployment taxes of $186.i. On February 1st, Suzie and Tony decide to purchase a vehicle to take customers on rock climbing trips. The vehicle cost $28,000 and was financed through the dealership with a 36 month loan at 6.5% interest. Payments of $858.17, including principle and interest will be due on the 1st of each month,beginning March 1st.j. On February 4th, purchased 60 watches for $3600 ($60 per watch) for cash. k. On February 9th, take Energy Group Inc. on a corporate leadership rock climbing trip. Energy Group Inc. is billed on account for the trip for $10,000.l. On February 14th, sold watches at the Valentines? Day Couples Relay. Sold 15 watches for $175 each, plus 6.5% sales tax. In addition, they collected $10,000 cash for entry fees of 100 couples.m. February 15th ? paid the payroll taxes from January 31st.n. On February 28th, invoices are sent to various other customers totaling $35,000 for clinics given during the month of February.o. February 28th, pay Victor?s salary of $3,000, less $450 federal and state income tax withholding and $230 FICA withheld. Accrue employer?s FICA of $230 and federal and state unemployment taxes of $186.p. March 1st ? the first payment of $858.17 on the vehicle loan is made. ($706.51 is applied toward the principal and $151.66 is interest expense)q. March 8th, purchased 30 watches for $1950 ($65 per watch), on account, terms 3/10, n/30.r. March 15th ? paid the payroll taxes from February 28th.s. March 20th ? pay for the watches purchased on March 8th.t. March 22nd ? collect $10,000 from Energy Group Inc. for their trip in February.u. March 23rd ? collect $25,000 from customers previously invoiced in February.v. March 31st? send invoices of $21,000 to customers for rock-climbing trips in March.w. March 31st, pay Victor?s salary of $3,000, less $450 federal and state income tax withholding and $230 FICA withheld. Accrue employer?s FICA of $230 and federal and state unemployment taxes of $186.4. Adjusting entries at March 31, 2013:1. Record three months of expired insurance ($300 per month).2. Record three months of rent used ($1000 per month).3. Record supplies expense. $500 of supplies remain on March 31st.4. Record depreciation on Bikes, Kayaks and Vehicle of $4,500 ($1,500 per month).5. The note payable of $30,000 is due in 3 years and accrues interest at 5% per year. The interest is payable on July 31 of each year. Record the interest for 3 months ended March 31st.6. Accrue the interest due on April 1st on the vehicle loan.7. Estimated uncollectible accounts receivable at March 31st are $500.8. Reconciled the bank statements for the 1st quarter of 2013. Service charges of $25 need to be recorded.5. Prepare the following financial statements at March 31, 2013A. Income Statement (multiple-step) for the 3 months ended March 31, 2013B. Statement of Stockholders? Equity for the 3 months ended March 31, 2013C. Balance Sheet (classified), March 31, 2013. The amount of the vehicle loan that is due within the next 12 months (Current portion of long-term debt) is $8830.D. Statement of Cash Flows for the 3 months ended March 31, 2013 using the indirect method. (We will go over this in class on Wednesday the 7th).

 

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