Sandy Bell opened a "Zip Line" eco-adventure park in July – a new company. The following transactions occurred in the first month of operations: July 1 Sandy invested $1,000 cash in exchange for 50 common shares. July 1 Purchased equipment on account - $15,000 due August 1. July 2 The company borrowed $25,000 in the form of a long-term bank loan. The money was planned to pay off the equipment loan. July 5 Purchased insurance for the year: paid $8,000 cash. (Note this amount should not be expensed as it represents an asset to the company. July 8 Paid off equipment purchased on July 1. July 9 Took first group through an adventure tour. Collected $1,000 cash. July 12 Purchased fuel: $500 cash. July 16 Purchased supplies: $100 cash. July 18 Sandy took a cash dividend of $1,000 to pay for personal expenses. July 20 Received but did not pay the telephone bill, $200. July 21 Took another tour group out. Billed the group $2,000. Payment has not yet been received. July 26 Received a utilities bill: $250. Did not pay yet. July 28 Took out a tour group. Received payment in full: $1,500. July 31 Paid employees' salaries of $3,000. Required: a.) Record all necessary journal entries based on the transactions above. b.) Post the transactions to T-Accounts. c.) Prepare a trial balance dated July 31.
Sandy Bell opened a "Zip Line" eco-adventure park in July – a new company. The following transactions occurred in the first month of operations: July 1 Sandy invested $1,000 cash in exchange for 50 common shares. July 1 Purchased equipment on account - $15,000 due August 1. July 2 The company borrowed $25,000 in the form of a long-term bank loan. The money was planned to pay off the equipment loan. July 5 Purchased insurance for the year: paid $8,000 cash. (Note this amount should not be expensed as it represents an asset to the company. July 8 Paid off equipment purchased on July 1. July 9 Took first group through an adventure tour. Collected $1,000 cash. July 12 Purchased fuel: $500 cash. July 16 Purchased supplies: $100 cash. July 18 Sandy took a cash dividend of $1,000 to pay for personal expenses. July 20 Received but did not pay the telephone bill, $200. July 21 Took another tour group out. Billed the group $2,000. Payment has not yet been received. July 26 Received a utilities bill: $250. Did not pay yet. July 28 Took out a tour group. Received payment in full: $1,500. July 31 Paid employees' salaries of $3,000. Required: a.) Record all necessary journal entries based on the transactions above. b.) Post the transactions to T-Accounts. c.) Prepare a trial balance dated July 31.
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter6: Cash And Receivables
Section: Chapter Questions
Problem 12E: Inferring Accounts Receivable Amounts At the end of 2019, Karras Inc. had a debit balance of 141,120...
Related questions
Question
100%
Salazar inc. Shows the following information on May 31, 2024, the company's fiscal year end:
Sandy bell opened a "zip line" eco-adventure park in july- a new company
Transcribed Image Text:Topic: Journal Entries, T-Accounts, Trial Balance
Sandy Bell opened a "Zip Line" eco-adventure park in July – a new
company.
The following transactions occurred in the first month of operations:
July 1 Sandy invested $1,000 cash in exchange for 50 common shares.
July 1 Purchased equipment on account - $15,000 due August 1.
July 2 The company borrowed $25,000 in the form of a long-term bank
loan. The money was planned to pay off the equipment loan.
July 5 Purchased insurance for the year: paid $8,000 cash. (Note this
amount should not be expensed as it represents an asset to the
company.
July 8 Paid off equipment purchased on July 1.
July 9 Took first group through an adventure tour. Collected $1,000
cash.
July 12 Purchased fuel: $500 cash.
July 16 Purchased supplies: $100 cash.
July 18 Sandy took a cash dividend of $1,000 to pay for personal
expenses.
July 20 Received but did not pay the telephone bill, $200.
July 21 Took another tour group out. Billed the group $2,000. Payment
has not yet been received.
July 26 Received a utilities bill: $250. Did not pay yet.
July 28 Took out a tour group. Received payment in full: $1,500.
July 31 Paid employees' salaries of $3,000.
Required:
a.) Record all necessary journal entries based on the transactions
above.
b.) Post the transactions to T-Accounts.
c.) Prepare a trial balance dated July 31.
Transcribed Image Text:Topic: Accounts Receivable
Salazar Inc. shows the following information on May 31,
2024, the company's fiscal year-end:
Account
Accounts receivable
$235,000
Allowance for
2,000
doubtful accounts
$1,850,000
Sales ($448,000 cash
sales)
The company's accountant estimates bad debts to be 2% of
credit sales.
Required:
a.) Prepare the adjustment to allowance for doubtful
accounts based on the information above.
b.) Show how accounts receivable, net would be disclosed
on the balance sheet.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 8 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College
EBK CONTEMPORARY FINANCIAL MANAGEMENT
Finance
ISBN:
9781337514835
Author:
MOYER
Publisher:
CENGAGE LEARNING - CONSIGNMENT
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College
EBK CONTEMPORARY FINANCIAL MANAGEMENT
Finance
ISBN:
9781337514835
Author:
MOYER
Publisher:
CENGAGE LEARNING - CONSIGNMENT
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning
College Accounting (Book Only): A Career Approach
Accounting
ISBN:
9781337280570
Author:
Scott, Cathy J.
Publisher:
South-Western College Pub