excercise 28 - 1 ACCOUNTING Exercise 28 Caterpillar 2...

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Unformatted text preview: 1 ACCOUNTING Exercise 28 Caterpillar 2 ECONOMIC EVENTS 1. Spend $30,000,000 to design a new bulldozer. 2. Spend $1,000,000 for prototypes of the bulldozer. 3. Spend $2,000,000 developing a marketing brochure. 4 Pay $2,000,000 to register a patent. 5. Create a $500,000 Petty Cash fund. 6. Pay $2,000,000 to install driveways and fences on our land. 7. Loan $1,000,000 to a supplier (10% rate). 8. Spend $1,600,000,000 producing 40,000 bulldozers. 9. Sell 35,000 bulldozers to customers, on credit, for $3,500,000,000. 10. Record $1,400,000,000 Cost of Sales. 11. We collect 50% of the Accounts Receivable within 10 days. Our terms are 2/10, N30. 12. Spend $400,000 from the petty cash fund on miscellaneous expenses. 3 ECONOMIC EVENTS 13. Accrue $10,000,000 estimated warranty costs (5 year warranty). 14. Accrue $5,000,000 estimated bad debts. 15. Pay $5,000,000 for warranty costs. 16. Write off $2,000,000 of Accounts Receivable. 17. Pay $40,000,000 for salaries. 18. Accrue $5,000,000 for estimated company restructuring costs (three year restructuring) 19. End of year. Record patent amortization (20 year life). 20. End of year. Record land improvement depreciation (10 year life, SL). 21. End of year. Record plant depreciation (20 year life, SYD). 22. End of year. Accrue interest on Note Receivable (10% rate). 23. End of year. Accrue estimated legal fees of $500,000 24. End of year. Accrue $1,000,000 for employee vacations (will be taken within one year). 25. Transfer Net Income (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 20,000,000,000 10 Manufacturing Plant Reference Transaction Current Balance Debit Credit Debit Credit 4,000,000,000 11 Land Reference Transaction Current Balance Debit Credit Debit Credit 100,000,000 12 Common Stock Reference Transaction Current Balance Debit Credit Debit Credit 5,000,000,000 13 Paid in Capital Reference Transaction Current Balance Debit Credit Debit Credit 5,000,000,000 14 Retained Earnings Reference Transaction Current Balance Debit Credit Debit Credit 14,100,000,000 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 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 50 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 51 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 52 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 53 TRIAL BALANCEpage 1 Account Debit Credit 54 TRIAL BALANCEpage 2 Account Debit Credit 55...
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This note was uploaded on 11/03/2010 for the course ACCT 325 taught by Professor Anderson,p during the Winter '09 term at Azusa Pacific.

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excercise 28 - 1 ACCOUNTING Exercise 28 Caterpillar 2...

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