I NEED HELP WITH PART 3 1.  Journalize the selected transactions. Assume 360 days per year. If no entry is required, select "No entry required" from the dropdown and leave the amount boxes blank. If an amount box does not require an entry, leave it blank. Jan. 3: Issued a check to establish a petty cash fund of $4,500. Date Description Debit Credit Jan. 3                 Feb. 26: Replenished the petty cash fund, based on the following summary of petty cash receipts: office supplies, $1,680; miscellaneous selling expense, $570; miscellaneous administrative expense, $880. Date Description Debit Credit Feb. 26                                 Apr. 14: Purchased $31,300 of merchandise on account, terms n/30. The perpetual inventory system is used to account for inventory. Date Description Debit Credit Apr. 14 Inventory        Accounts Payable        May 13: Paid the invoice of April 14. Date Description Debit Credit May 13 Accounts Payable        Cash        May 17: Received cash from daily cash sales for $21,200. The amount indicated by the cash register was $21,240. Date Description Debit Credit May 17 Cash        Cash Short and Over        Sales        June 2: Received a 60-day, 8% note for $180,000 on the Ryanair account. Date Description Debit Credit June 2 Notes Receivable        Accounts Receivable-Ryanair        Aug. 1: Received amount owed on June 2 note, plus interest at the maturity date. Date Description Debit Credit Aug. 1 Cash        Notes Receivable        Interest Revenue        Aug. 24: Received $7,600 on the Finley account and wrote off the remainder owed on a $9,000 accounts receivable balance. (The allowance method is used in accounting for uncollectible receivables.) Date Description Debit Credit Aug. 24 Cash        Allowance for Doubtful Accounts        Accounts Receivable-Finley        Sept. 15: Reinstated the Finley account written off on August 24 and received $1,400 cash in full payment. Date Description Debit Credit Sept. 15 Accounts Receivable-Finley        Allowance for Doubtful Accounts        Cash        Accounts Receivable-Finley        Sept. 15: Purchased land by issuing a $670,000, 90-day note to Zahorik Co., which discounted it at 9%. Date Description Debit Credit Sept. 15 Land        Interest Expense        Notes Payable        Oct. 17: Sold office equipment in exchange for $135,000 cash plus receipt of a $100,000, 90-day, 9% note. The equipment had a cost of $320,000 and accumulated depreciation of $64,000 as of October 17. Date Description Debit Credit Oct. 17 Cash        Notes Receivable        Accumulated Depreciation-Office Equip.        Loss on Sale of Office Equipment        Office Equipment        Nov. 30: Journalized the monthly payroll for November, based on the following data: Salaries   Deductions Sales salaries   $135,000   Income tax withheld   $39,266 Office salaries   77,250   Social security tax withheld   12,735     $212,250   Medicare tax withheld   3,184 Unemployment tax rates:       State unemployment   5.4%   Federal unemployment   0.8% Amount subject to unemployment taxes:       State unemployment   $5,000   Federal unemployment   5,000     Date Description Debit Credit Nov. 30 Sales Salaries Expense        Office Salaries Expense        Employees Income Tax Payable        Social Security Tax Payable        Medicare Tax Payable        Salaries Payable      Nov. 30: Journalized the employer's payroll taxes on the payroll. Date Description Debit Credit Nov. 30 Payroll Taxes Expense        Social Security Tax Payable        Medicare Tax Payable        State Unemployment Tax Payable        Federal Unemployment Tax Payable        Dec. 14: Journalized the payment of the September 15 note at maturity. Date Description Debit Credit Dec. 14 Notes Payable        Cash        Dec. 31: The pension cost for the year was $190,400, of which $139,700 was paid to the pension plan trustee. Date Description Debit Credit Dec. 31 Pension Expense        Cash        Unfunded Pension Liability      You must complete part 1 before completing part 2. Based on the following data, prepare a bank reconciliation for December of the current year: a. Balance according to the bank statement at December 31, $283,000.b. Balance according to the ledger at December 31, $245,410.c. Checks outstanding at December 31, $68,540.d. Deposit in transit, not recorded by bank, $29,500.e. Bank debit memo for service charges, $750.f. A check for $12,700 in payment of an invoice was incorrectly recorded in the accounts as $12,000.   Kornett CompanyBank ReconciliationDecember 31, 20Y5 Balance according to bank statement        $ Add: Deposit in transit on December 31          Deduct: Outstanding checks          Adjusted balance       $           Balance according to company's records        $ Deduct: Bank service charges    $     Deduct: Error in recording check          Total deductions         Adjusted balance       $ Part 3: Note: You must complete parts 1 and 2 before completing part 3 of this comprehensive problem. Based on the bank reconciliation prepared in (2), journalize the entry or entries to be made by Kornett Company. Use the Miscellaneous Administrative Expense account to record bank service charges. If an amount box does not require an entry, leave it blank.   Date Description Debit Credit Dec. 31 Miscellaneous Administrative Expense        Accounts Payable        Cash

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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I NEED HELP WITH PART 3

1.  Journalize the selected transactions. Assume 360 days per year.

If no entry is required, select "No entry required" from the dropdown and leave the amount boxes blank. If an amount box does not require an entry, leave it blank.

Jan. 3: Issued a check to establish a petty cash fund of $4,500.

Date Description Debit Credit
Jan. 3      
       

 

Feb. 26: Replenished the petty cash fund, based on the following summary of petty cash receipts: office supplies, $1,680; miscellaneous selling expense, $570; miscellaneous administrative expense, $880.

Date Description Debit Credit
Feb. 26      
       
       
       

 

Apr. 14: Purchased $31,300 of merchandise on account, terms n/30. The perpetual inventory system is used to account for inventory.

Date Description Debit Credit
Apr. 14 Inventory     
  Accounts Payable     

 

May 13: Paid the invoice of April 14.

Date Description Debit Credit
May 13 Accounts Payable     
  Cash     

 

May 17: Received cash from daily cash sales for $21,200. The amount indicated by the cash register was $21,240.

Date Description Debit Credit
May 17 Cash     
  Cash Short and Over     
  Sales     

 

June 2: Received a 60-day, 8% note for $180,000 on the Ryanair account.

Date Description Debit Credit
June 2 Notes Receivable     
  Accounts Receivable-Ryanair     

 

Aug. 1: Received amount owed on June 2 note, plus interest at the maturity date.

Date Description Debit Credit
Aug. 1 Cash     
  Notes Receivable     
  Interest Revenue     

 

Aug. 24: Received $7,600 on the Finley account and wrote off the remainder owed on a $9,000 accounts receivable balance. (The allowance method is used in accounting for uncollectible receivables.)

Date Description Debit Credit
Aug. 24 Cash     
  Allowance for Doubtful Accounts     
  Accounts Receivable-Finley     

 

Sept. 15: Reinstated the Finley account written off on August 24 and received $1,400 cash in full payment.

Date Description Debit Credit
Sept. 15 Accounts Receivable-Finley     
  Allowance for Doubtful Accounts     
  Cash     
  Accounts Receivable-Finley     

 

Sept. 15: Purchased land by issuing a $670,000, 90-day note to Zahorik Co., which discounted it at 9%.

Date Description Debit Credit
Sept. 15 Land     
  Interest Expense     
  Notes Payable     

 

Oct. 17: Sold office equipment in exchange for $135,000 cash plus receipt of a $100,000, 90-day, 9% note. The equipment had a cost of $320,000 and accumulated depreciation of $64,000 as of October 17.

Date Description Debit Credit
Oct. 17 Cash     
  Notes Receivable     
  Accumulated Depreciation-Office Equip.     
  Loss on Sale of Office Equipment     
  Office Equipment     

 

Nov. 30: Journalized the monthly payroll for November, based on the following data:

Salaries   Deductions
Sales salaries   $135,000   Income tax withheld   $39,266
Office salaries   77,250   Social security tax withheld   12,735
    $212,250   Medicare tax withheld   3,184
Unemployment tax rates:    
  State unemployment   5.4%
  Federal unemployment   0.8%
Amount subject to unemployment taxes:    
  State unemployment   $5,000
  Federal unemployment   5,000

 

 

Date Description Debit Credit
Nov. 30 Sales Salaries Expense     
  Office Salaries Expense     
  Employees Income Tax Payable     
  Social Security Tax Payable     
  Medicare Tax Payable     
  Salaries Payable     

Nov. 30: Journalized the employer's payroll taxes on the payroll.

Date Description Debit Credit
Nov. 30 Payroll Taxes Expense     
  Social Security Tax Payable     
  Medicare Tax Payable     
  State Unemployment Tax Payable     
  Federal Unemployment Tax Payable     

 

Dec. 14: Journalized the payment of the September 15 note at maturity.

Date Description Debit Credit
Dec. 14 Notes Payable     
  Cash     

 

Dec. 31: The pension cost for the year was $190,400, of which $139,700 was paid to the pension plan trustee.

Date Description Debit Credit
Dec. 31 Pension Expense     
  Cash     
  Unfunded Pension Liability     

You must complete part 1 before completing part 2.

Based on the following data, prepare a bank reconciliation for December of the current year:

a. Balance according to the bank statement at December 31, $283,000.
b. Balance according to the ledger at December 31, $245,410.
c. Checks outstanding at December 31, $68,540.
d. Deposit in transit, not recorded by bank, $29,500.
e. Bank debit memo for service charges, $750.
f. A check for $12,700 in payment of an invoice was incorrectly recorded in the accounts as $12,000.

 

Kornett Company
Bank Reconciliation
December 31, 20Y5
Balance according to bank statement        $
Add: Deposit in transit on December 31         
Deduct: Outstanding checks         
Adjusted balance       $
         
Balance according to company's records        $
Deduct: Bank service charges    $    
Deduct: Error in recording check         
Total deductions        
Adjusted balance       $

Part 3:

Note: You must complete parts 1 and 2 before completing part 3 of this comprehensive problem.

Based on the bank reconciliation prepared in (2), journalize the entry or entries to be made by Kornett Company. Use the Miscellaneous Administrative Expense account to record bank service charges. If an amount box does not require an entry, leave it blank.

 

Date Description Debit Credit
Dec. 31 Miscellaneous Administrative Expense     
  Accounts Payable     
  Cash     

 

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