BAF3MB - Unit 2.docx - BAF3M-B Lesson 6 18 a fixed assets b worksheet c current liabilities d liquidity order e current assets f long-term liabilities

BAF3MB - Unit 2.docx - BAF3M-B Lesson 6 18 a fixed assets b...

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Unformatted text preview: BAF3M-B Lesson 6 18 a) fixed assets b) worksheet c) current liabilities d) liquidity order e) current assets f) long-term liabilities 19 Accounts Acc No. PM Property Management Worksheet For the period ending December 31, 2016 Trial Balance Income Statement Balance Sheet Debit Debit Credit Debit Credit Credit Cash 100 $1255 $1255 Accounts Receivable 101 103500 103500 Office Equipment 141 8635 8635 Automobile 142 12810 12810 Accounts Payable 200 $2000 $2000 G.Costella, Capital 300 120000 120000 G.Costella, Drawing 301 Fees Income 400 Maintenance 507 5400 $5400 Salaries Expense 508 12000 12000 2400 2400 25000 $25000 Page 1 of 17 Utilities Expense 510 1000 0000 1000 0000 000 000000 $147000 $147000 18400 25000 128600 122000 Net Income 6600 $25000 6600 $25000 $128600 $128600 b) PM Property Management Income Statement For the period ended December 31,2016 Revenue Fees Income Total Revenue $25000 $25000 Expense Salaries expense $12000 Utilities expense 1000 Total Expense $13000 Net Income $12000 Page 2 of 17 PM Property Management Balance Sheet December 31 2016 Assets Current Assets Cash Accounts Receivable $1 255 103 500 Total Current Assets $ 104 755 Fixed Assets Equipment $8 635 Automobile 12 810 Total Fixed Assets $ 21 445 Total Assets $126200 Liabilities and Owner’s Equity Current Liabilities Accounts Payable $2 000 Total Liabilities $2 000 Owner’s Equity G. Costella capital October 1st $122400 Less: owner’s drawing 2400 G.Costella Capital 120000 Total Liabilities and Owner’s equity $122000 Page 3 of 17 LESSON 7 20 a) Prepaid expenses are items that are paid in advances; this includes insurance, rent and supplies. b) A decrease of assets over a period of time. c) The decreased value of an asset after each year d) The straight line method is used to determine the yearly depreciation expense 21 Accounts Supplies Prepaid Insurance Depreciation of Expense Prepaid Rent Accumulated Depreciation on building Equipment Insurance Expense Supplies Expense Building Income Statement Balance Sheet X X X X X X X X X 22 Journal Date 2016 June 30 June 30 June 30 Accounts and explanation page 1 P Ref Debit Depreciation Expense, supplies Accumulate Depreciation, supplies Adjusting entry to record Depreciation Expense, prepaid rent Accumulate Depreciation, Prepaid Rent Adjusting rent paid for one month 516 Prepaid Insurance Cash Adjustment, insurance starts in July, purchased in June 2400 Credit 516 3000 3000 2400 Page 4 of 17 June 30 Depreciation Expense, Truck Accumulate Depreciation Adjustment, one month depreciation, declining-balance method 1500 1500 23 The expenses will be understated making the net income overstated. This is giving out false information to the readers and investors. Also the company did not use accrual basis method of recording. The company is supposed to write all its transaction when they incurred it. 24 The difference between straight line and declining-balance method is that in straight line the depreciation is the same each year, meaning the net value decreases by the same value each year. In declining-balance method the net value decreases by a certain percentage. 25 A) The net income is overstated by $2800. This is because no adjustments were made B) The assets are overstated by $2800. This is because the value assets decreased but was not recorded. C) The correct figure for net income is $44200. The correct of asset is $ 142200 after the adjustments are properly done Lesson 8 L.Stanisky Worksheet December 31,2015 Accounts Acc. No Trial Balance Debit Cash 100 Accounts Receivable Supplies 101 102 1000 Equipment 110 15000 Acc.Depr --Equipment 114 Credit Adjustments Debit Credit Income Statement Debit Credit Balance Sheet Debit 10500 10500 13000 13000 (a)400 Credit 600 15000 3000 (b)2400 5400 Page 5 of 17 Accounts Payable Bank loan 200 l.Stanisky Captial L. Stanisky Drawings Sales 300 Salaries Expense Rent Expense 500 Telephone Expense Miscellaneou s Expense Office expense Supplies Expense Depr. ExpEquipment 502 210 301 503 504 3650 10000 10000 12800 12800 2000 400 501 3650 2000 18500 18500 5000 5000 800 800 150 150 225 225 275 275 505 (a)400 506 47950 (b)240 0 2800 47950 400 2400 2800 Net Income 9250 18500 41100 9250 18500 31850 9250 18500 41100 41100 General Ledger Account: Cash Date 2016 Dec 31 Items/particulars P.R Debit 10 500 Credit No:1 Balance 10500 Credit No:2 Balance 13000 General Ledger Account: Accounts Receivable Date 2016 Items/particulars Dec 31 P.R Debit 13000 General Ledger Account: Supplies No:3 Page 6 of 17 Date 2016 Dec 31 31 Items/particulars P.R Debit 1000 Credit 400 Balance 1000 600 General Ledger Account: Equipment Date 2016 Items/particulars Dec 31 P.R Debit 3000 Credit No:4 Balance 3000 General Ledger Account: Depreciation, Equipment Date 2016 Items/particulars Dec 31 31 P.R Debit J1 Credit 3000 2400 No:5 Balance 3000 5400 Credit 3650 No:6 Balance 3650 Credit 10000 No:7 Balance 10000 Credit 12800 No:8 Balance 12800 General Ledger Account: Accounts Payable Date 2016 Items/particulars Dec 31 P.R Debit General Ledger Account: Bank loan Date 2016 Items/particulars Dec 31 P.R Debit General Ledger Account: L Stanisky Capital Date 2016 Items/particulars Dec 31 P.R Debit General Ledger Account: L. Stanisky Drawings Date 2016 Items/particulars Dec 31 P.R Debit 2000 Credit No:9 Balance 2000 Page 7 of 17 General Ledger Account: Sales Date 2016 Items/particulars Dec 31 P.R Debit Credit 18500 No:10 Balance 18500 Credit No:11 Balance General Ledger Account: Salaries Expense Date 2016 Items/particulars P.R Dec 31 Debit 5000 5000 General Ledger Account: Rent Expense Date 2016 Items/particulars Dec 31 P.R Debit 800 Credit No:12 Balance 800 Credit No:13 Balance 150 Credit No:14 Balance 225 Credit No:15 Balance 275 Credit No:16 Balance 400 General Ledger Account: Telephone Expense Date 2016 Items/particulars Dec 31 P.R Debit 150 General Ledger Account: Miscellaneous Expense Date 2016 Items/particulars Dec 31 P.R Debit 225 General Ledger Account: Office Expense Date 2016 Items/particulars Dec 31 P.R Debit 275 General Ledger Account: Supplies Expense Date 2016 Items/particulars Dec 31 P.R Debit 400 Page 8 of 17 General Ledger Account: Depreciation Expense, Equipment Date 2016 Items/particulars P.R Debit Dec 31 2400 Credit No:17 Balance 2400 Credit 18500 No:18 Balance 18500 9250 General Ledger Account: Income Summary Date 2016 Items/particulars Dec 31 31 31 P.R Debit 9250 9250 c) Journal Date 2015 Dec 31 Account and Explanation Supplies Expense Page 1 P.R Debit Credit 1000 Supplies 400 To record supplies use in December Dec 31 Accumulated Depreciation, Equipment 3000 Equipment 2400 Accumulated Depreciation of for the month of December Dec 31 Sales 18500 Income Summary 18500 To close sales account Page 9 of 17 Dec 31 Income Summary 9250 Salaries Expense 5000 rent Expense 800 Telephone Expense 150 Miscellaneous Expense 225 Office Expense 275 Supplies Expense 400 Depreciation Expense, Equipment 2400 To close expense account 31 Income Summary 9250 L. Stanisky Capital 9250 To close the income summary account 31 L.Stanisky Capital 2000 L.Stanisky Drawings 2000 To close Drawing account d) Accounts Receivable Cash Dec 31 10500 Dec 31 13000 Page 10 of 17 Supplies Dec 31 1000 Balance 600 Supplies Expense Dec 31 400 Equipment Dec 31 Dec 31 Accumulated Depreciation Equipment 15000 Accounts Payable Dec 31 Dec 31 3650 3000 Dec 31 2400 Balance: 5400 Dec 31 10 000 L.Stanisky Drawings 12 800 Dec 31 Depreciation Expense, Equipment 2400 Dec 31 Bank loan L.Stanisky Capital Dec 31 400 2000 Income Summary Dec 31 9250 Dec 31 9250 Dec 31 18500 Page 11 of 17 Account Title Cash Accounts Receivable Supplies Equipment Accumulated Depreciation L.Stanisky Post-closing Trial Balance December 31 2015 No Trial Balance Debit $10500 13000 600 15000 Credit $5400 Equipment Accounts Payable Bank Loan L. Stanisky Capital TOTALS $39100 3650 10000 20050 $39100 f) L.Stanisky Statement of Owner’s Equity for month ending December 31,2015 Balance at the beginning of the period L.Stanisky Drawing Sales Revenue Total Expense Balance at the end of the period $12 800 2 000 18500 9250 $20050 27) a) accounting period b)Balance Sheet c) Temporary accounts d) Income summary e) revenue and expense f) Owner’s Capital g) Post-closing trial Balance h) Owner’s equity i) zero balance j) Zero Lesson 9 Items Cash Sales Purchases Salaries Expense Purchases Return Delivery Expense Statement Balance sheet Income statement Income statement Income statement Income statement Income statement Section Current asset Revenue Cost of goods sold Operating Expense Cost of goods sold Operating Expense Page 12 of 17 Transportation in Building Beginning Inventory Ending Inventory Purchasing discount Income statement Balance Sheet Income statement Income statement, balance sheet Income statement Cost of goods sold Fixed asset Cost of goods sold Cost of goods sold, current asset Cost of goods sold 29 Xtreme Sports Schedule of Cost of Goods Sold For the moth ending May 31 2016 Inventory may 1 Add: Purchase Less: Purchase Return Purchase discount Net Purchasing cost Add: Tranportation-in Total cost of Merchandise Purchased Cost of Merchandise Available for sale May 31Less Inventory Cost of Goods Sold $37 900 18800 800 210 1010 17790 975 18765 56665 35900 $20765 b) 60 000 – 20765 = $39235 d) 39235 – 13000=$26235 30 Date Aug 10 10 11 Particulars Merchandise inventory Accounts payable Purchased from Greater Wholesalers dated Aug 8, term 3/10 n/30 P.R Debit 3507 Credit 3507 Merchandise inventory Accounts payable Purchased from Winnipeg Manufactures dated Aug 7 term 2/10,n/30 7017 Accounts payable 105 7017 Page 13 of 17 Cash Paid CN Express for transportation 12 105 Cash 1000 Sales Merchandise sold to B Gaynor Term 2/10 n/30 12 16 1000 Cost of goods sold Merchandise inventory To record merchandise sold terms 2/10 n/30 600 Cash 215 600 Merchandise inventory Received cash for damaged condition from invoice dated Aug 14. 17 22 24 215 Accounts payable Cash To pay invoice dated Aug 7 (bill not fully paid) 6876.66 Cash Sale discount Accounts Receivable Received cash to pay invoice 357 dated Aug 12, 2 percent discount 980 20 Accounts payable Cash Paid to Greater Wholesalers fro invoice, cheque 33 3193.24 68767.66 1000 3193.24 Lesson 10 77. Journal Date 2016 July 2 Accounts and explanation Purchases Accounts payable/ Perfect Plus Ltd Purchased from Perfect Plus Ltd terms net 30 Page 1 P.R Debit Credit 2000 2000 Page 14 of 17 invoice PP 354 2 3 4 5 6 6 9 10 10 Transportation-in Accounts payable/ CNR Paid CNR for transportation invoice C-8632 terms net 15 160 Accounts receivable – S. Booth Sales Sale to S.Booth invoice 39287 2/10, n/30 750 Accounts receivable – R.Paulsen Sales Sale to Paulesen net 30 675 Purchases Accounts payable/ P.Slater Ltd Purchased merchandise 1/10, n/30 800 Purchases Accounts payable/urban Cartage Purchased invoice 7767 for transportation charge net 15 150 Accounts Payable/Perfect Plus Ltd Sales return and Allowance Refund for goods 260 Cash Sales discount Accounts receivable/ S.Booth 735 15 Office Supplies Accounts payable/Masterson Ltd Purchased office supplies net 30 100 Equipment 850 Accounts payable/ILT System Equipment 160 750 675 800 150 260 750 100 850 Purchased for accounting equipment net 60 Page 15 of 17 14 Accounts payable/P.Slater 800 Purchase discount 8 Cash 792 Paid for invoice of June 5 less discount 1 percent 30 Accounts payable/Perfect Plus Ltd 1740 Cash 1740 Paid Perfect Plus Ltd. On account 32. Journal Date 2016 Account and Explanation May 1 Cash Page 307 P.R Debit Credit 1073.50 Sales 950 GST Payable 47.50 PST Payable 76 Cash earned. Cash sales 920-935 2 Cash 664 Accounts receivable/M.Ball 664 Cheque received to pay invoice 913 3 Cash 317.52 Sales discount 6.48 Accounts receivable 324 Less discount 2%. Paid for invoice 799 5 Cash 3500 Owner’s equity 3500 Owner’s investment in the business 7 Bank loan Cash 8000 8000 Bank credit memo Page 16 of 17 8 Cash 548.80 Sales discount 11.20 Account receivable/C.Lu 560 Less discount 2%. Paid for invoice 805 9 Cash 2435.15 Sales 2155 GST 107.75 PST 172.40 Cash earned. Cash sales slips 940 to 955 Page 17 of 17 ...
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