On January 1, Ted, a student at State U, decides to start Kopy Kat, Inc., a corporation that mass produces copies of CDs for various organizations and businesses around the college. He is very careful to ensure customers have full rights to the material on their CDs. The following occurs during January. a. Ted deposits $500 of his own money into the company's checking account. b. A note payable is signed in the amount of $1,000 from Neighborhood Bank. The note is due in one year. c. A CD duplicator is purchased that cost is $1,300. d. Five hundred blank CDs are purchased for $150 on account. e. Kopy Kat pays $20 cash for flyers to advertise. f. It sells 400 CDs to various groups for $0.80 per CD. It receives cash payment for 300 of the CDs and the groups owe for the other 100 CDs. g. Kopy Kat pays $100 on its accounts payable. h. It receives $40 in advance to copy 50 CDs for a student group. Work will not begin until February. i. Kopy Kat incurs $40 in tax expense. The taxes will be paid in February. Required: A. Prepare journal entries for the above events if needed. B. Prepare adjusting entries for the following and post them to your T-accounts. 10. Ted's roommate, helps out and is paid $50 per month. He will get his first check on Feb. 1. 11. Kopy Kat incurs $10 in interest expense on its note payable. The interest will be paid when the note is paid. Prepare the January balance sheet and income statement
On January 1, Ted, a student at State U, decides to start Kopy Kat, Inc., a corporation that mass produces copies of CDs for various organizations and businesses around the college. He is very careful to ensure customers have full rights to the material on their CDs. The following occurs during January. a. Ted deposits $500 of his own money into the company's checking account. b. A note payable is signed in the amount of $1,000 from Neighborhood Bank. The note is due in one year. c. A CD duplicator is purchased that cost is $1,300. d. Five hundred blank CDs are purchased for $150 on account. e. Kopy Kat pays $20 cash for flyers to advertise. f. It sells 400 CDs to various groups for $0.80 per CD. It receives cash payment for 300 of the CDs and the groups owe for the other 100 CDs. g. Kopy Kat pays $100 on its accounts payable. h. It receives $40 in advance to copy 50 CDs for a student group. Work will not begin until February. i. Kopy Kat incurs $40 in tax expense. The taxes will be paid in February. Required: A. Prepare journal entries for the above events if needed. B. Prepare adjusting entries for the following and post them to your T-accounts. 10. Ted's roommate, helps out and is paid $50 per month. He will get his first check on Feb. 1. 11. Kopy Kat incurs $10 in interest expense on its note payable. The interest will be paid when the note is paid. Prepare the January balance sheet and income statement
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Please Explain Proper Step by Step and Do Not Give Solution In Image Format And Fast Answering Please Thanks In Advance ?
Transcribed Image Text:On January 1, Ted, a student at State U, decides to start Kopy Kat, Inc., a corporation that
mass produces copies of CDs for various organizations and businesses around the college.
He is very careful to ensure customers have full rights to the material on their CDs. The
following occurs during January.
a. Ted deposits $500 of his own money into the company's checking account.
b. A note payable is signed in the amount of $1,000 from Neighborhood Bank. The note is due
in one year.
c. A CD duplicator is purchased that cost is $1,300.
d. Five hundred blank CDs are purchased for $150 on account.
e. Kopy Kat pays $20 cash for flyers to advertise.
f. It sells 400 CDs to various groups for $0.80 per CD. It receives cash payment for 300 of the
CDs and the groups owe for the other 100 CDs.
g. Kopy Kat pays $100 on its accounts payable.
h. It receives $40 in advance to copy 50 CDs for a student group. Work will not begin until
February.
i. Kopy Kat incurs $40 in tax expense. The taxes will be paid in February.
Required:
A. Prepare journal entries for the above events if needed.
B. Prepare adjusting entries for the following and post them to your T-accounts.
10. Ted's roommate, helps out and is paid $50 per month. He will get his first
check on Feb. 1.
11. Kopy Kat incurs $10 in interest expense on its note payable. The interest
will be paid when the note is paid.
Prepare the January balance sheet and income statement
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