Reference no: EM131691647
Question: (Accounts receivable and sales transactions; comprehensive problem) Camp Bryn Mawr, a summer camp, started the year with cash of $40,000, land costing $300,000, and buildings and equipment costing $250,000. Because the camp had no liabilities, the assets were offset by the equity account F. Jonas, Capital, in the amount of $590,000. The following transactions occurred during the year:
1. Jonas sent bills in the amount of $150,000 to the parents of 75 campers.
2. Jonas purchased 80 camper packages (consisting of uniforms and supplies) on credit from a vendor. He received the packages and put them in inventory. He also received a bill for $4,800 (80 packages costing $60 a package) from the vendor.
3. When they arrived at the camp, each of the 75 campers received a camper package. Jonas sent bills in the amount of $6,750 to the parents, charging them $90 a package.
4. Jonas received cash in the amount of $148,750 from the parents, based on the bills sent out in transactions 1 and 3.
5. During the summer, Jonas paid employee salaries in the amount of $100,000 and food expenses of $8,000. (Assume all the food was consumed.)
6. Jonas paid the invoice for $4,800 for transaction 2.
7. Anticipating that several parents might not pay their bills, Jonas set up an allowance for uncollectible receivables in the amount of $4,000.
8. One of the parents, who owed $2,000, declared bankruptcy. Jonas wrote off the account as uncollectible.
9. Jonas made a provision for depreciation for the year, assuming that the buildings and equipment had a useful life of 20 years.
10. Jonas promised the camp director a bonus of $5,000, based on the excellent work she had done during the year. Jonas, therefore, accrued a liability for that amount. Use the preceding information to do the following:
a. Prepare journal entries to record these transactions. (Among others, you will need accounts for Revenues-camper fees, Revenues-uniform sales, and Inventory-uniforms.)
b. Post the journal entries to ledger T-accounts.
c. From the ledger accounts, prepare a trial balance.
d. Using the trial balance, prepare an income statement, a statement of changes in owner's equity, and a balance sheet.