Randiddle co. is a merchandising business

Assignment Help Accounting Basics
Reference no: EM13499828

Randiddle Co. is a merchandising business. Their account balances as of November 30, 2012 (unless otherwise indicated), are as follows:

110 Cash $ 74,370
112 Accounts Receivable 6,178
113 Allowance for Doubtful Accounts 650
115 Merchandise Inventory 2,346
116 Prepaid Insurance 5,750
117 Store Supplies 2,850
123 Store Equipment 100,800
124 Accumulated Depreciation-Store Equipment 31,060
210 Accounts Payable 3,286
211 Salaries Payable 0
218 Interest Payable 0
220 Note Payable (Due 2017) 30,000
($6,000 to be paid in 2013)
310 Randiddle, Capital (January 1, 2012) 46,288
311 Randiddle, Withdrawals 60,000
312 Income Summary 0
410 Sales 296,130
411 Sales Returns and Allowances 10,020
412 Sales Discounts 7,200
510 Cost of Goods Sold 30,250
520 Sales Salaries Expense 34,400
521 Advertising Expense 18,000
522 Depreciation Expense 0
523 Store Supplies Expense 0
529 Miscellaneous Selling Expense 2,800
530 Office Salaries Expense 25,500
531 Rent Expense 24,200
532 Insurance Expense 0
533 Bad Debt Expense 0
539 Miscellaneous Administrative Expense 1,650
550 Interest Expense 1,100


Randiddle Co. uses the perpetual inventory system and the Last-in, First-out costing method. Transportation-in and purchase discounts should be added to the Inventory Control Sheet, but since this will complicate the computation of the Last-in, First-out costing method, please ignore this step in the process. They also use the Allowance Method for bad debt.

The Accounts Receivable and Accounts Payable Subsidiary Ledgers along with the Inventory Control Sheet should be updated as each transaction affects them (daily).



Randiddle Co. sells three types of microwave ovens.

The sale prices of each are:

900 watt microwave: $199
1000 watt microwave: $299
1200 watt microwave: $499


During December, the last month of the accounting year, the following transactions were completed:

Dec. 1. Issued check number 2632 for the December rent, $2,200.
2. Sold two 1200 watt microwaves for cash.
4. Purchased four 1000 watt microwaves on account from Matt Co., terms 2/10,
n/30, FOB shipping point, $596.
5. Issued check number 2633 to pay the transportation charges on purchase of
December 4, $89. (NOTE: Debit Merchandise Inventory. Do not include shipping and purchase discounts to the Inventory Control sheet for this project.)
6. Sold six 1000 watt microwaves and four 1200 watt microwaves on account to Briana Co., invoice 891, terms 2/10, n/30, FOB shipping point.
8. Issued check number 2634 for refund of cash on sales made for cash, $150.
(Customer was going to return goods until an allowance was arranged.)
10. Purchased store supplies on account from Prince Co., terms n/30, $310.
10. Issued check to Matt Co. number 2635 for the full amount due, less discount
allowed. (Round discount to nearest dollar.)
11. Paid Prince Co. full amount due, check number 2636.
12. Issued credit memo for one 1000 watt microwave returned on sale of
December 6. (NOTE: Assume the returned microwave was from the 11/30 inventory)
13. Issued check number 2637 for advertising expense for last half of December, $3,000.
14. Received cash from Briana Co. for the full amount due (less return of December 12 and discount; round to nearest dollar).
19. Issued check number 2638 to buy five 900 watt microwaves, $495.
19. Issued check number 2639 for $596 to Joseph Co. on account.
20. Sold seven 900 watt microwaves on account to Cameron Co., invoice number 892, terms 1/10, n/30, FOB shipping point.
20. To expedite sale on Dec. 20, issued check number 2640 for shipping charges on sale to Cameron on December 20, $120 (NOTE: Cameron Co. will be reimbursing us for this shipping cost).
21. Received $1,396 cash from McKenzie Co. on account, no discount.
21. Purchased three 1200 watt microwaves on account from Elisha Co., terms 1/10, n/30, FOB shipping point, $747, shipping $78 (NOTE: Debit Merchandise Inventory $825, but only put $747 in the Inventory Control Sheet).
24. Received notification that Marie Co. has been granted bankruptcy with no
amount of recovery. We are to write-off her amount due. (Note: See page
365 for entry required.)
26. Issued a debit memo for return of $249 because of damage to one 1200 watt
microwave purchased on December 21, receiving credit from the seller.
27. Issued check number 2641 for sales salaries of $2,050 and office
salaries of $1,400.
28. Purchased store equipment on account from Joseph Co., terms n/30, FOB
destination, $1,200.
29. Issued check number 2642 for store supplies, $70.
29. Purchased seven 1000 watt microwave from Prince Co, terms 1/10, n/30,
FOB shipping point, for $1,113 on account, shipping $107.
30. Sold eight 1000 watt microwaves on account to Briana Co., invoice number
893, terms 2/10, n/30, FOB shipping point.
30. Received cash from sale of December 20, less discount, plus transportation
paid on December 20. (Round calculations to the nearest dollar.)
31. Issued check number 2643 for purchase of December 21, less return
of December 26 and discount. (Round discount to the nearest dollar.)
31. Issued a debit memo for $200 of the purchase returned from
December 28.


Instructions:

1. Enter the balances of each of the accounts in the appropriate balance column of the General Ledger (B-S and I-S Ledger). Write Balance in the item section, and place a (x) in the Post Reference column.
2. Journalize the transactions in a sales journal, purchases journal, cash receipts journal, cash payments journal, or general journal as illustrated in chapter 7. Also post to the Accounts Receivable and Accounts Payable Subsidiary ledgers and Inventory Control Sheet as needed.
3. Total each column on the special journals and prove the journals.
4. Post the totals of the account named columns and individually post the "Other Accounts" columns as well to the General Ledger.
5. Prepare the Schedule of Accounts Receivable and the Schedule of Accounts Payable (their total amount must equal the amount in their controlling general ledger account).
6. Prepare the unadjusted trial balance on the worksheet.
7. Complete the worksheet for the year ended December 31, 2012, using the following adjustment data:
a. Merchandise inventory on December 31 $1,090
b. Insurance expired during the year 2,250
c. Store supplies on hand on December 31 850
d. Depreciation for the current year needs to be calculated. The business uses
the Straight-line method, the store equipment has a useful life of 10 years
with no salvage value. (NOTE: the purchase and return will not be included
as the dates of the transactions were after the 15th of the month).
e. Accrued salaries on December 31:
Sales salaries $1,075
Office salaries 540 $1,615
f. The note payable terms are at 8%, payment is not being made until Jan. 3, 2013. Interest must be recognized for one month.
g. Calculate the Bad Debt adjustment amount; net realizable value of Accounts Receivable is determined to be $6,313.

8. Prepare a multiple-step income statement, a statement of owner's equity, and a
classified balance sheet in good form. (Recommend review of "Current Liabilities" on page 149.)
9. Journalize and post the adjusting entries.
10. Journalize and post the closing entries. Indicate closed accounts by inserting a zero
in both balance columns opposite the closing entry.
11. Prepare a post-closing trial balance.

Reference no: EM13499828

Questions Cloud

Andrew jackson credit corp : Accounts receivable of $14,800 (gross) are factored with Andrew Jackson Credit Corp
What is its period of revolution : A doubly charged helium atom whose mass is 6.6 * 10^- 27 kg is accelerated by a voltage of 2400 V. What is its period of revolution
Determine the radius of motion : An electron is projected vertically upward with a speed of 1.50 * 10^6 m/s into a uniform magnetic field of 0.200 T, What is the radius of motion
Explain the presence of the radioactive gas radon : The presence of the radioactive gas radon (Rn) in well water obtained from aquifers that lie in rock deposits presents a possible health hazard in parts of the United States.
Randiddle co. is a merchandising business : Randiddle Co. is a merchandising business.
What are the systems that are affected by asthma : what are the systems that are affected by asthma - what are the explanation how the system are affected and how it happens to the system once the body gets asthma.
Determine the radius of the path of the ion : Positively charged aluminum ion, Al3+, has a mass of 4:50 1026 kg. After being accelerated through a potential dierence of 650 V, Calculate the radius of the path of the ion in the eld
Explain what are three theoretical reaction mechanisms : What are 3 theoretical reaction mechanisms that can occur with bromine addition to trans-cinnamic acid. The last mechanism accounts for a mixture of syn and anti products
The higher the interest rate the lower : The higher the interest rate the lower the present value of a future amount. Why?

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd