Reference no: EM132484005
Colton Enterprises experienced the following events for Year 1, the first year of operation:
Point 1: Acquired $52,000 cash from the issue of common stock.
Point 2: Paid $13,700 cash in advance for rent. The payment was for the period April 1, Year 1, to March 31, Year 2.
Point 3: Performed services for customers on account for $106,000.
Point 4: Incurred operating expenses on account of $43,500.
Point 5: Collected $81,000 cash from accounts receivable.
Point 6: Paid $38,000 cash for salary expense.
Point 7: Paid $34,800 cash as a partial payment on accounts payable.
Adjusting Entries
- Made the adjusting entry for the expired rent. (See Event 2.)
- Recorded $5,800 of accrued salaries at the end of Year 1.
Events for Year 2
Point 1: Paid $5,800 cash for the salaries accrued at the end of the prior accounting period.
Point 2: Performed services for cash of $55,000.
Point 3: Purchased $4,500 of supplies on account.
Point 4: Paid $15,600 cash in advance for rent. The payment was for one year beginning April 1, Year 2.
Point 5: Performed services for customers on account for $122,000.
Point 6: Incurred operating expenses on account of $58,500.
Point 7: Collected $106,000 cash from accounts receivable.
Point 8: Paid $56,000 cash as a partial payment on accounts payable.
Point 9: Paid $33,200 cash for salary expense.
Point 10: Paid a $14,000 cash dividend to stockholders.
Adjusting Entries
- Made the adjusting entry for the expired rent. (Hint: Part of the rent was paid in Year 1.)
- Recorded supplies expense. A physical count showed that $750 of supplies were still on hand.
Required
Question a. Record the events and adjusting entries for Year 1 in general journal form. (Do not round intermediate calculations. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)