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1. Prepare journal entries for each of the transactions through December 20 2. Prepare any adjusting entries required on December 31. 3. Show how all of the liabilities arising from these items are reported on the balance sheet at December 31.

1. Prepare journal entries for each of the transactions through December 20 2. Prepare any adjusting entries required on December 31. 3. Show how all of the liabilities arising from these items are reported on the balance sheet at December 31.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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EZ Curb Company completed the following transactions. The annual accounting period ends December 31. January 8 Purchased merchandise on account at a cost of $25,000. (Assume a perpetual inventory system.) January 17 Paid for the January 8 purchase. April 1 Received $57,600 from National Bank after signing a 12-month, 17.0 percent, promissory note. June 3 Purchased merchandise on account at a cost of $29,000. July S Paid for the June 3 purchase. July 31 Rented out a small office in a building owned by EZ Curb Company and collected six months' rent in advance, amounting to $12,600. (Use an account called Deferred Revenue.) December 20 Collected $320 cash on account from a customer. December 31 Determined that wages of $10,900 were earned but not yet paid on December 31 (Ignore payroll taxes). December 31 Adjusted the accounts at year-end, relating to interest.. December 31 Adjusted the accounts at year-end, relating to rent. Required: 1. Prepare journal entries for each of the transactions through December 20 2. Prepare any adjusting entries required on December 31. 3. Show how all of the liabilities arising from these items are reported on the balance sheet at December 31
Transcribed Image Text:EZ Curb Company completed the following transactions. The annual accounting period ends December 31. January 8 Purchased merchandise on account at a cost of $25,000. (Assume a perpetual inventory system.) January 17 Paid for the January 8 purchase. April 1 Received $57,600 from National Bank after signing a 12-month, 17.0 percent, promissory note. June 3 Purchased merchandise on account at a cost of $29,000. July S Paid for the June 3 purchase. July 31 Rented out a small office in a building owned by EZ Curb Company and collected six months' rent in advance, amounting to $12,600. (Use an account called Deferred Revenue.) December 20 Collected $320 cash on account from a customer. December 31 Determined that wages of $10,900 were earned but not yet paid on December 31 (Ignore payroll taxes). December 31 Adjusted the accounts at year-end, relating to interest.. December 31 Adjusted the accounts at year-end, relating to rent. Required: 1. Prepare journal entries for each of the transactions through December 20 2. Prepare any adjusting entries required on December 31. 3. Show how all of the liabilities arising from these items are reported on the balance sheet at December 31
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