Reference no: EM131805196

Problem

On Feb.28,2015,the Star Theatre Inc.'s general ledger showed cash $15000; Land $85000; Buildings &77,000; equipment $20000;accounts payable $12000;mortgage payable $118,000 ; common shares $40,000 and retained earnings $27,000 during the month of March ,the following events and transactions occurred:

Mar. 2 received three movies to be shown during the first three weeks of March. The film rental was $27,000. of that amount, $10000was paid in cash and the remainder will be paid on March 12.

2 hired M.Brewer to oprate concession stand. Brewer agrees to pay Star Theatre 15%of gross

5 ordered three additional movies, to be shown the last 10 days of March. The film retal cost will be $300 per night.

9 received $16,300 from customers for admissions.( Hint : star theatre uses the account Fees Earned to record revenue from admissions)

12 paid balance due on the movies rented on March 2.

13 paid the accounts payable owing at the end of February.

19 paid advertising expenses, $950

20 received $16,600 from customers for admissions

23. received the movies ordered on March 5 and paid rental fee of $3,000($300*10nights)

25 received $18,400 from customers fro admissions

27 paid salaries of $4,200

30 received statement from M. Brewer, showing gross concession receipts of $16,600 and the balance due to star theatre of $2490 (16600*15%)for March. Brewer paid half of the balance due and will remit the remainder on april 15

30 paid $1,250 of the balance due on the mortagage, as well as $750 of interest on the mortgage

30 paid $3000 for the monthly income tax instalment

Instructions

a. Using T accounts enter the beginning balances in the ledger as at Feb.28

b. Journalize the march transactions

c. Post the march journal entries to the ledger

d. Prepare a trial balance at March.31.