Exercise 5 - 1 ACCOUNTING Exercise 5 Six Flags 2 ECONOMIC...

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Unformatted text preview: 1 ACCOUNTING Exercise 5 Six Flags 2 ECONOMIC EVENTS 1. Build theme park rides. The bank pays the $100,000,000 construction costs. Sign a 10%, five year note payable with the bank 2. Pay $1,000,000 for park supplies to be used over the next two years. 3. Pay $600,000 for a three year liability insurance policy. 4. Receive $1,000,000 from theme park guests for season passes. 5. Receive a $200,000 invoice for advertising from the advertising agency. 6. Pay $500,000 for food to be sold at theme park restaurants. 7. Receive $14,000,000 cash from park guests for one day admissions. 8. Other park guests charge $2,000,000 for one day admissions on Visa/MasterCard. Credit card companies charge a 6% fee. 9. Receive $1,000,000 for park food sales. 10. Record $200,000 for park food Cost of Sales. 11. Receive $100,000 invoice for attorney services. 12. Pay $500,000 for park landscaping. 13. Pay $2,000,000 for salaries. 3 ECONOMIC EVENTS 14. Pay $200,000 to register patent design of theme rides. 15. Pay $500,000 for flood damage (first flood ever). 16. End of year. Record usage of $300,000 of park supplies. 17. End of year. Write off one year of prepaid insurance. 18. End of year. Record depreciation on the theme park rides (20 year lives). 19. End of year. Record amortization on the patent (20 year life). 20. End of year. Accrue interest on the note payable. 21. End of year. Recognize all the season pass revenue. 22. End of year. Accrue $400,000 for salaries. 23. Transfer 1,530,000 Net Loss to Retained Earnings. 4 JOURNAL ENTRIES 1. 2. 3. 4. 5. 5 JOURNAL ENTRIES 6. 7. 8. 9. 10. 6 JOURNAL ENTRIES 11. 12. 13. 14. 15. 7 JOURNAL ENTRIES 16. 17. 18. 19. 20. 8 JOURNAL ENTRIES 21. 22. 23. 24. 25. 9 Cash Reference Transaction Current Balance Debit Credit Debit Credit 200,000,000 200,000,000 10 Common Stock Reference Transaction Current Balance Debit Credit Debit Credit 50,000,000 50,000,000 11 Paid in Capital Reference Transaction Current Balance Debit Credit Debit Credit 100,000,000 100,000,000 12 Retained Earnings Reference Transaction Current Balance Debit Credit Debit Credit 50,000,000 50,000,000 13 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 14 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 15 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 16 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 17 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 18 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 19 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 20 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 21 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 22 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 23 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 24 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 25 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 26 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 27 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 28 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 29 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 30 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 31 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 32 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 33 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 34 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 35 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 36 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 37 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 38 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 39 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 40 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 41 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 42 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 43 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 44 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 45 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 46 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 47 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 48 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 49 TRIAL BALANCE.page 1 Account Debit Credit 50 TRIAL BALANCE.page 2 Account Debit Credit Total 51...
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Exercise 5 - 1 ACCOUNTING Exercise 5 Six Flags 2 ECONOMIC...

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