Required information [The following information applies to the questions displayed below.] Vanishing Games Corporation (VGC) operates a massively multiplayer online game, charging players a monthly subscription of $13. At the start of January 2021, VGC's income statement accounts had zero balances and its balance sheet account balances were as follows: Cash Accounts Receivable. Supplies Equipment Buildings Land Accounts Payable Deferred Revenue Notes Payable (due 2025) Common Stock Retained Earnings $1,600,000 174,000 15,100 930,000 510,000 2,050,000 113,000 74,000 94,000 2,500,000 2,498,100 In addition to the above accounts, VGC's chart of accounts includes the following: Service Revenue, Salaries and Wages Expense, Advertising Expense, and Utilities Expense. The following transactions occurred during the January month: a. Received $57,750 cash from customers on 1/1 for subscriptions that had already been earned and charged on account in 2020. b. Purchased 10 new computer servers for $41.500 on 1/2: paid $11,500 cash and signed a three-year note for the remainder owed. c. Paid $14,300 for an Internet advertisement that ran today on 1/3. d. On January 4, purchased and received $5,300 of supplies on account. e. Received $150,000 cash on 1/5 from customers for service revenue earned but not previously recorded in January. f. On January 6, paid $5,300 cash for supplies purchased on January 4. g. On January 7, sold 19,900 subscriptions at $13 each for services provided during January. Half was collected in cash and half was sold on account. h. Paid $380,000 in wages to employees on 1/30 for work done in January. On January 31, received an electric and gas utility bill for $6.260 for January utility services. The bill will be paid in February. 3. Enter the beginning balances shown above in the following T-accounts and post the journal entries.
Required information [The following information applies to the questions displayed below.] Vanishing Games Corporation (VGC) operates a massively multiplayer online game, charging players a monthly subscription of $13. At the start of January 2021, VGC's income statement accounts had zero balances and its balance sheet account balances were as follows: Cash Accounts Receivable. Supplies Equipment Buildings Land Accounts Payable Deferred Revenue Notes Payable (due 2025) Common Stock Retained Earnings $1,600,000 174,000 15,100 930,000 510,000 2,050,000 113,000 74,000 94,000 2,500,000 2,498,100 In addition to the above accounts, VGC's chart of accounts includes the following: Service Revenue, Salaries and Wages Expense, Advertising Expense, and Utilities Expense. The following transactions occurred during the January month: a. Received $57,750 cash from customers on 1/1 for subscriptions that had already been earned and charged on account in 2020. b. Purchased 10 new computer servers for $41.500 on 1/2: paid $11,500 cash and signed a three-year note for the remainder owed. c. Paid $14,300 for an Internet advertisement that ran today on 1/3. d. On January 4, purchased and received $5,300 of supplies on account. e. Received $150,000 cash on 1/5 from customers for service revenue earned but not previously recorded in January. f. On January 6, paid $5,300 cash for supplies purchased on January 4. g. On January 7, sold 19,900 subscriptions at $13 each for services provided during January. Half was collected in cash and half was sold on account. h. Paid $380,000 in wages to employees on 1/30 for work done in January. On January 31, received an electric and gas utility bill for $6.260 for January utility services. The bill will be paid in February. 3. Enter the beginning balances shown above in the following T-accounts and post the journal entries.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Transcribed Image Text:**Vanishing Games Corporation (VGC) Financial Exercise**
Vanishing Games Corporation (VGC) operates a massively multiplayer online game, charging players a monthly subscription of $13. At the start of January 2021, VGC's income statement accounts had zero balances, and its balance sheet account balances were as follows:
- Cash: $1,600,000
- Accounts Receivable: $174,000
- Supplies: $15,100
- Equipment: $930,000
- Buildings: $510,000
- Land: $2,050,000
- Accounts Payable: $123,000
- Deferred Revenue: $113,000
- Notes Payable (due 2025): $94,000
- Common Stock: $2,500,000
- Retained Earnings: $2,498,100
**Transactions for January:**
a. Received $57,750 cash from customers on 1/1 for subscriptions that had already been earned and charged on account in 2020.
b. Purchased 10 new computer servers for $41,500 on 1/2; paid $11,500 cash and signed a three-year note for the remainder.
c. Used $3,040 of air in them equipment that had been delivered in December.
d. On January 4, purchased and received $5,300 of supplies on account.
e. Received $150,000 cash on 1/5 from customers for service revenue earned but not previously recorded in January.
f. On January 6, paid $5,300 cash for supplies purchased on January 4.
g. On January 7, sold 19,900 subscriptions at $13 each for services provided during January. Half was collected in cash and half was sold on account.
h. Paid $380,000 in wages to employees on 1/30 for work done in January.
i. On January 31, received an electric and gas utility bill for $6,260 for January utility services. The bill will be paid in February.
**Instructions:**
3. Enter the beginning balances shown above in the following T-accounts and post the journal entries.
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