Exercise 2: Greenock Company has the following information available for accruals for the year ended December 31, 2020. The company adjusts its accounts annually. 1. The December utility bill for $425 was unrecorded on December 31. Greenock paid the bill on January 11. 2. Greenock is open 7 days a week and employees are paid a total of $3,500 every Monday for a 7-day (Monday-Sunday) workweek. December 31 is a Thursday, so employees will have worked 4 days (Monday, December 28-Thursday, December 31) that they have not been paid for by year-end. Employees will be paid next on January 4. 3. Greenock signed a $48,000, 5% bank loan on November 1, 2020, due in 2 years. No interest pay- ments were made in 2020. Interest for 2020 was paid on January 1, 2021. 4. Greenock receives a fee from Pizza Shop next door for all pizzas sold to customers using Greenock's facility. The amount owed for December is $300, which Pizza Shop will pay on January 4. (Hint: Use the Service Revenue account.) 5. Greenock rented some of its unused warehouse space to a client for $6,000 a month, payable the first day of the following month. It received the rent for the month of December on January 2. Required: 1. Record the transactions in the general journal for 2017. 2. Post the transactions to the ledger (T accounts) and calculate closing balances of the accounts
Exercise 2: Greenock Company has the following information available for accruals for the year ended December 31, 2020. The company adjusts its accounts annually. 1. The December utility bill for $425 was unrecorded on December 31. Greenock paid the bill on January 11. 2. Greenock is open 7 days a week and employees are paid a total of $3,500 every Monday for a 7-day (Monday-Sunday) workweek. December 31 is a Thursday, so employees will have worked 4 days (Monday, December 28-Thursday, December 31) that they have not been paid for by year-end. Employees will be paid next on January 4. 3. Greenock signed a $48,000, 5% bank loan on November 1, 2020, due in 2 years. No interest pay- ments were made in 2020. Interest for 2020 was paid on January 1, 2021. 4. Greenock receives a fee from Pizza Shop next door for all pizzas sold to customers using Greenock's facility. The amount owed for December is $300, which Pizza Shop will pay on January 4. (Hint: Use the Service Revenue account.) 5. Greenock rented some of its unused warehouse space to a client for $6,000 a month, payable the first day of the following month. It received the rent for the month of December on January 2. Required: 1. Record the transactions in the general journal for 2017. 2. Post the transactions to the ledger (T accounts) and calculate closing balances of the accounts
Century 21 Accounting Multicolumn Journal
11th Edition
ISBN:9781337679503
Author:Gilbertson
Publisher:Gilbertson
Chapter13: Accounting For Payroll And Payroll Taxes
Section: Chapter Questions
Problem 3AP
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Transcribed Image Text:Exercise 2: Greenock Company has the following information available for accruals for the year ended
December 31, 2020. The company adjusts its accounts annually.
1. The December utility bill for $425 was unrecorded on December 31. Greenock paid the bill on
January 11.
2. Greenock is open 7 days a week and employees are paid a total of $3,500 every Monday for a 7-day
(Monday-Sunday) workweek. December 31 is a Thursday, so employees will have worked 4 days
(Monday, December 28-Thursday, December 31) that they have not been paid for by year-end.
Employees will be paid next on January 4.
3. Greenock signed a $48,000, 5% bank loan on November 1, 2020, due in 2 years. No interest pay-
ments were made in 2020. Interest for 2020 was paid on January 1, 2021.
4. Greenock receives a fee from Pizza Shop next door for all pizzas sold to customers using Greenock's
facility. The amount owed for December is $300, which Pizza Shop will pay on January 4. (Hint:
Use the Service Revenue account.)
5. Greenock rented some of its unused warehouse space to a client for $6,000 a month, payable the
first day of the following month. It received the rent for the month of December on January 2.
Required:
1. Record the transactions in the general journal for 2017.
2. Post the transactions to the ledger (T accounts) and calculate closing balances of the
accounts
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