mga 201 midterm practice problems solutions

Part a a insurance expense 4350 prepaid insurance

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3) Part a A. Insurance Expense 4,350 Prepaid Insurance 4,350 B. Depreciation Expense 8,150 Accumulated Depreciation - Equipment 8,150 C. Supplies Expense 52,900 Supplies 52,900 ($138,600 − $85,700) D. Interest Receivable 260 Interest Revenue 260 E. Unearned Revenue 5,600 Service Revenue 5,600 F. Accounts Receivable 2,000 Service Revenue 2,000
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Part b Garvey Company Adjusted Trial Balance December 31, 2015 Debits Credits Cash $68,900 Accounts Receivable ($116,300 + $2,000) 118,300 Interest Receivable ($1,300 + $260) 1,560 Supplies ($138,600 − $52,900) 85,700 Prepaid Insurance ($8,700 − $4,350) 4,350 Notes Receivable (short-term) 50,000 Equipment 277,800 Accumulated Depreciation––Equipment ($64,500 + $8,150) $72,650 Accounts Payable 104,100 Salaries and Wages Payable 21,600 Unearned Revenue ($9,200 − $5,600) 3,600 Notes Payable (long-term) 87,400 Common Stock 216,100 Retained Earnings 143,500 Service Revenue ($40,500 + $5,600 + $2,000) 48,100 Interest Revenue ($21,900 + $260) 22,160 Supplies Expense ($0 + $52,900) 52,900 Repairs and Maintenance Expense 26,400 Rent Expense 17,800 Depreciation Expense ($0 + $8,150) 8,150 Insurance Expense ($0 + $4,350) 4,350 Salaries and Wages Expense 3,000 Totals $719,210 $719,210
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4) Part a Delta Inc. Income Statement For the Year Ended April 30, 2015 Revenues Service Revenue $904,000 Interest Revenue 114,100 Total Revenues 1,018,100 Expenses Supplies Expense 336,200 Repairs and Maintenance Expense 247,900 Depreciation Expense 57,750 Rent Expense 30,500 Income Tax Expense 138,300 Total Expenses 810,650 Net Income $207,450 Part b Delta Inc. Statement of Retained Earnings For the Year Ended April 30, 2015 Balance, April 1, 2015 $207,400 Add: Net Income 207,450 Subtract: Dividends 20,000 Balance, April 30, 2015 $394,850
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5) Part a Service Revenue 11,000 Insurance Expense 500 Interest Expense 80 Supplies Expense 2,500 Utilities Expense 1,500 Retained Earnings 6,420 Part b Dr Retained Earnings + Cr 3,200 10/1/14 6,420 9/30/15 9,620 9/30/15
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Part c Reliance Yacht Repair, Inc. Post-Closing Trial Balance At September 30, 2015 Debits Credits Cash $9,420 Accounts Receivable 6,000 Notes Receivable (short-term) 5,500 Supplies 1,500 Prepaid Rent 500 Equipment 4,000 Accumulated Depreciation––Equipment $2,000 Accounts Payable 1,500 Unearned Revenue 2,000 Notes Payable (long-term) 2,500 Common Stock 9,300 Retained Earnings 9,620 Service Revenue 0 Insurance Expense 0 Interest Expense 0 Supplies Expense 0 Utilities Expense 0 Totals $26,920 $26,920
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6) Account Temporary (T) or Permanent (P) Closed with Debit (Dr), Closed with Credit (Cr), or Not Closed (NC) 1.Supplies Expense T Cr 2. Accumulated Depreciation P NC 3. Sales Revenue T Dr 4. Notes Payable (long-term) P NC 5. Unearned Revenue P NC 6. Salaries and Wages Payable P NC 7. Retained Earnings P NC 8. Dividends T Cr 9. Interest Revenue T Dr 10. Prepaid Insurance P NC
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7) Part a Service Revenue 18,000 Salaries and Wages Expense 4,000 Rent Expense 2,000 Depreciation Expense 1,000 Income Tax Expense 1,000 Retained Earnings 10,000 Retained Earnings 1,000 Dividends 1,000 Part b T.O.’S DANCE STUDIO Post-Closing Trial Balance At December 31, 2015 Account Name Debits Credits Cash $5,000 Accounts Receivable 8,000 Equipment 9,000 Accumulated Depreciation––Equipment $3,000 Accounts Payable 3,000 Income Tax Payable 1,000 Unearned Revenue 1,000 Common Stock 2,000 Retained Earnings 12,000 Service Revenue 0 Salaries and Wages Expense 0 Rent Expense 0 Depreciation Expense 0 Income Tax Expense 0 Totals $22,000 $22,000
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Part c T.O.’S DANCE STUDIO Balance Sheet At December 31, 2015 Assets
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