Reference no: EM132672250

Sol-Electronics Company starts from November 1, 2019. The company's accounting yearend is December 31.2019

1. On Nov. 1, two shareholders contributed $20,000 to the company in exchange for ordinary shares

2. On Nov. 1, Company purchased an automobile for $30,000 by writing a note payable to the bank. The note is due on Nov. 1 2020 with an annual interest rate is 6%. The truck has a useful life of 5 years and residual value is estimated to be $5,000. The company is using double declining depreciation method.

3. On Nov. 5, Company purchased 50 laptops for sale to customers at $500 each from Dell on credit. The payment is due in 60 days.

4. On Nov. 10, Company sold 30 laptops to WS University at $800 per unit. The payment term is 3/10, n/30.

5. On Nov 10, Company sold 5 laptops to Daejeon Electronics at $800 per unit. The payment term is 3/10, n/30.

6. On Nov. 15, WS University returned 5 laptops.

7. On Nov. 20, WS University paid the remaining balance.

8. On Dec. 1, Company hired an employee at monthly wage of $3,000. The wage is payable on the fifth day after the end of the month.

9. On Dec 1, Company purchased 50 laptops at $550 each from Del on credit. The payment is due in 60 days.

10. On Dec. 5, Company sold 40 laptops to CN University at $900 per unit. The payment term is 2/10, n/30. Company uses first-in first-out (FIFO) method for inventory accounting.

11. On Dec 10, Company paid Nov. utilities bill of $500 and Nov. rent of $2000 in cash.

12. On Dec 31, Company chose allowance method for uncollectible accounts receivable.

It is estimated that 10% of accounts receivable on December 31 will be uncollectible.

Question 1: Prepare journal entries for the transactions (if necessary) in 2019 and all necessary adjusting journal entries to prepare 2019 financial statements.