083Q2 - Name_4-Digit_Section Accounting Cycle[083Q2 Collect...

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Name___________________________4-Digit #________Section_____________ Accounting Cycle: [083Q2] Collect information that will enable you to determine the correct balances in all accounts at the end of Year 2. 1. Michael Company [the firm] was formed on February 28, Year 1, when five people each invested $25,000. On that same date, one investor lent $40,000 to the firm that is to be repaid on February 28, Year 2, along with $7,200 of interest. 2. The firm leased an office space for one year on March 1, Year 1, moving in the same day. The monthly rate was $7,000 and the rent for the entire year had to be paid on November 1, Year 1. 3. On March 1, Year 1, the firm rented some equipment for one year. The firm paid $18,000 at the time of signing the rental agreement. This amount covers the entire 12-month lease period. 4. On March 12, Year 1, the firm purchased supplies on account at a cost of $9,000. 5. On March 14, Year 1, the firm returned 25% of the supplies because of defects. 6. On April 1, Year 1, the firm hired seven employees at a monthly salary of $5,000 each. These employees started working immediately. These employees are to be paid at the middle of each month for the period ending on that day. Their first payday will be on April 15, Year 1, and covers the first half of April. 7.
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This note was uploaded on 10/07/2008 for the course ACCT 250A taught by Professor Hopkins during the Fall '07 term at USC.

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083Q2 - Name_4-Digit_Section Accounting Cycle[083Q2 Collect...

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