The Bookkeeper of Kenneth's Toyland presented the following ledger accounts and their balances as of June 30, 2018, the end of the fiscal period: Account Titles       Cash In Bank  487288 Cash On Hand  75200 Accounts Receivable 112000 Allowance for Bad Debts 4000 Notes Receivable  4800 Merchandise Inventory, July 1, 2017 89500 Prepaid Store Insurance 6300 Store Furniture and Fixtures 16000 Accumulated Depreciation - Store Furniture and Fixtures 500 Office Furniture and Fixtures 15000 Accumulated Depreciation - Office Furniture and Fixtures  900 Accounts Payable  54000 Notes Payable  180000 Unearned Commission  2400 Withholding Taxes Payable 490 SS & EC Premiums Payable 522 Phil Health Premiums Payable 100 Pag - Ibig Premiums Payable  200 Alfonso, Capital 521900 Alfonso, Personal 30000 Sales  583200 Sales Returns & Allowances  5020 Sales Discount  2880 Purchases 242000 Purchase Returns & Allowances  3000 Purchase Discount 2000 Freight In 6000 Advertising Expense  9000 Sales Salaries Expense  60000 Office Salaries Expense  33400 Rent Expense  96800 Taxes Expense  12000 Utilities Expense  42400 Interest Expense  600 Interest Income  3000 SS & EC Premiums Expense 6424 Phil Health Premiums Expense 1200 Pag - Ibig Premiums Expense 2400 Additional data needed for adjustments: a) Increase the allowance for doubtful accounts to 5% of accounts receivable  b) the notes received from the customers consists of: 30-day, 9% note for 4000 dated June 10, 2018 60-day 800 note dated June 5, 2018 c) the business has paid on January 1, 2017 insurance premium for a two - year policy effective on that date d) the store furniture & fixture are depreciated over a useful life of 5 years. of those on hand as of June 30, 6000 were acquired only on June 1, 2017. the office furniture & fixture are to be depreciated at a rate of 20% per anum. e) sales salaries of 550 has accrued as of June 30  f) on May 1, 2018, the business paid for the three-month advertising contract for 900.  g) the notes payable represents a 60-day, 18% note dated June 10, 2018, for which no interest has yet been paid. h) the business received a commission of 4,200 but only one-third of this has been earned by the company. i) merchandise unsold, per physical count of June 30, 2018, amounted to three-fourth of the beginning inventory. j) accrue 3% percentage tax on net sales. last quarter of June 30 net sales amounted to 175,200. Required: Prepare an eight-column worksheet Prepare an income statement and a statement of financial position. Three-fourth of rent and utilities should be allocated to selling expenses.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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The Bookkeeper of Kenneth's Toyland presented the following ledger accounts and their balances as of June 30, 2018, the end of the fiscal period:

Account Titles  
   
Cash In Bank  487288
Cash On Hand  75200
Accounts Receivable 112000
Allowance for Bad Debts 4000
Notes Receivable  4800
Merchandise Inventory, July 1, 2017 89500
Prepaid Store Insurance 6300
Store Furniture and Fixtures 16000
Accumulated Depreciation - Store Furniture and Fixtures 500
Office Furniture and Fixtures 15000
Accumulated Depreciation - Office Furniture and Fixtures  900
Accounts Payable  54000
Notes Payable  180000
Unearned Commission  2400
Withholding Taxes Payable 490
SS & EC Premiums Payable 522
Phil Health Premiums Payable 100
Pag - Ibig Premiums Payable  200
Alfonso, Capital 521900
Alfonso, Personal 30000
Sales  583200
Sales Returns & Allowances  5020
Sales Discount  2880
Purchases 242000
Purchase Returns & Allowances  3000
Purchase Discount 2000
Freight In 6000
Advertising Expense  9000
Sales Salaries Expense  60000
Office Salaries Expense  33400
Rent Expense  96800
Taxes Expense  12000
Utilities Expense  42400
Interest Expense  600
Interest Income  3000
SS & EC Premiums Expense 6424
Phil Health Premiums Expense 1200
Pag - Ibig Premiums Expense 2400

Additional data needed for adjustments:

a) Increase the allowance for doubtful accounts to 5% of accounts receivable 

b) the notes received from the customers consists of:
30-day, 9% note for 4000 dated June 10, 2018
60-day 800 note dated June 5, 2018

c) the business has paid on January 1, 2017 insurance premium for a two - year policy effective on that date

d) the store furniture & fixture are depreciated over a useful life of 5 years. of those on hand as of June 30, 6000 were acquired only on June 1, 2017. the office furniture & fixture are to be depreciated at a rate of 20% per anum.

e) sales salaries of 550 has accrued as of June 30 

f) on May 1, 2018, the business paid for the three-month advertising contract for 900. 

g) the notes payable represents a 60-day, 18% note dated June 10, 2018, for which no interest has yet been paid.

h) the business received a commission of 4,200 but only one-third of this has been earned by the company.

i) merchandise unsold, per physical count of June 30, 2018, amounted to three-fourth of the beginning inventory.

j) accrue 3% percentage tax on net sales. last quarter of June 30 net sales amounted to 175,200.

Required:

  1. Prepare an eight-column worksheet
  2. Prepare an income statement and a statement of financial position. Three-fourth of rent and utilities should be allocated to selling expenses. 
  3. Make the necessary closing entries
  4. Prepare a post-closing trial balance
  5. Prepare the reversing entries
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