More Info OctOct 1 38 comma 00038000 2424 1 320 comma 0003

More Info

Oct.Oct. 1

38 comma 00038,000

$ 24$24

1

$ 320 comma 000$320,000?,

55?%

$ 4 comma 000$4,000

NovemberNovember

$ 200 comma 000$200,000?;

$ 120 comma 000$120,000.

1

88?%

$ 7 comma 200$7,200

OctoberOctober

20192019.

3

Elite SupplyElite Supply

$ 124 comma 000$124,000?,

15

$ 200$200

31

$ 140 comma 000$140,000

77?%.

$ 84 comma 000$84,000

66?%.

31

OctoberOctober

31

OctoberOctober.

Nov.Nov. 1

Paid the first mortgage payment.

3

Elite SupplyElite Supply

OctoberOctober

10

Elite SupplyElite Supply

$ 200 comma 000$200,000?,

12

400400

$ 12$12

15

OctoberOctober

15

OctoberOctober

16

$ 2 comma 500$2,500

17

Declared cash dividends of? $1 per outstanding share of common stock.

18

$ 260$260

27

Paid the cash dividends.

30

$ 190 comma 000$190,000

77?%.

$ 114 comma 000$114,000

66?%.

30

NovemberNovember

30

NovemberNovember.

Dec.Dec. 1

Paid the second mortgage payment.

10

Elite SupplyElite Supply

NovemberNovember

12

$ 7 comma 300$7,300

15

200200

$ 16$16

15

NovemberNovember

15

NovemberNovember

18

$ 210$210

19

Elite SupplyElite Supply

$ 85 comma 000$85,000?,

31

$ 160 comma 000$160,000

77?%.

$ 96 comma 000$96,000

66?%.

31

DecemberDecember

31

DecemberDecember.

Data Table

The Tusquittee Company

Chart of Accounts

Cash

Dividends Payable—Common

Merchandise Inventory

Notes Payable

Land

Mortgages Payable

Building

Common Stock—$1 Par Value

Store Fixtures

Paid-in Capital in Excess of Par—Common

Accumulated Depreciation

Paid-in Capital from Treasury Stock Transactions

Accounts Payable

Retained Earnings

Employee Income Taxes Payable

Treasury Stock—Common

FICA—OASDI Taxes Payable

Cash Dividends

FICA—Medicare Taxes Payable

Sales Revenue

Employee Health Insurance Payable

Cost of Goods Sold

Federal Unemployment Taxes Payable

Salaries Expense

State Unemployment Taxes Payable

Payroll Tax Expense

Income Tax Payable

Utilities Expense

Sales Tax Payable

Depreciation Expense

Estimated Warranty Payable

Warranty Expense

Interest Payable

Income Tax Expense

Interest Expense

Oct.Oct. ?1: Issued a

$ 320 comma 000$320,000?,

?10-year,

55?%

mortgage payable for land with an existing store building. Mortgage payments of

$ 4 comma 000$4,000

are due on the first day of each? month, beginning

NovemberNovember

1. The assets had the following market? values: Land,

$ 200 comma 000$200,000?;

?Building,

$ 120 comma 000$120,000.

Date

Accounts

Debit

Credit

Oct. 1

Oct.Oct. 1 Issued 38 comma 00038,000 shares of? $1 par value common stock for cash of $ 24$24 per share. 1 Issued a $ 320 comma 000$320,000?, ?10-year, 55?% mortgage payable for land with an existing store building. Mortgage payments of $ 4 comma 000$4,000 are due on the first day of each? month, beginning NovemberNovember 1. The assets had the following market? values: Land, $ 200 comma 000$200,000?; ?Building, $ 120 comma 000$120,000. 1 Issued a? one-year, 88?% note payable for $ 7 comma 200$7,200 for store fixtures. The principal and interest are due OctoberOctober ?1, 20192019. 3 Purchased merchandise inventory on account from Elite SupplyElite Supply for $ 124 comma 000$124,000?, terms? n/30. 15 Paid $ 200$200 for utilities. 31 Recorded cash sales for the month of $ 140 comma 000$140,000 plus sales tax of 77?%. The cost of the goods sold was $ 84 comma 000$84,000 and estimated warranty payable was 66?%. 31 Recorded OctoberOctober payroll and paid employees. 31 Accrued employer payroll taxes for OctoberOctober. Nov.Nov. 1 Paid the first mortgage payment. 3 Paid Elite SupplyElite Supply for the merchandise inventory purchased on OctoberOctober 3. 10 Purchased merchandise inventory on account from Elite SupplyElite Supply for $ 200 comma 000$200,000?, terms? n/30. 12 Purchased 400400 shares of treasury stock for $ 12$12 per share. 15 Paid all liabilities associated with the OctoberOctober 31 payroll. 15 Remitted? (paid) sales tax from OctoberOctober sales to the state of North Carolina. 16 Paid $ 2 comma 500$2,500 to satisfy warranty claims. 17 Declared cash dividends of? $1 per outstanding share of common stock. 18 Paid $ 260$260 for utilities. 27 Paid the cash dividends. 30 Recorded cash sales for the month of $ 190 comma 000$190,000 plus sales tax of 77?%. The cost of the goods sold was $ 114 comma 000$114,000 and estimated warranty payable was 66?%. 30 Recorded NovemberNovember payroll and paid employees. 30 Accrued employer payroll taxes for NovemberNovember. Dec.Dec. 1 Paid the second mortgage payment. 10 Paid Elite SupplyElite Supply for the merchandise inventory purchased on NovemberNovember 10. 12 Paid $ 7 comma 300$7,300 to satisfy warranty claims. 15 Sold 200200 shares of treasury stock for $ 16$16 per share. 15 Paid all liabilities associated with the NovemberNovember 30 payroll. 15 Remitted? (paid) sales tax from NovemberNovember sales to the state of North Carolina. 18 Paid $ 210$210 for utilities. 19 Purchased merchandise inventory on account from Elite SupplyElite Supply for $ 85 comma 000$85,000?, terms? n/30. 31 Recorded cash sales for the month of $ 160 comma 000$160,000 plus sales tax of 77?%. The cost of the goods sold was $ 96 comma 000$96,000 and estimated warranty payable was 66?%. 31 Recorded DecemberDecember payroll and paid employees. 31 Accrued employer payroll taxes for DecemberDecember.

Solution

Date Accounts Title Dr Cr 1-Oct Cash (38000*24) $912,000 Common Stock—$1 Par Value $38,000 Paid-in Capital in Excess of Par—Common $874,000 1-Oct Land $200,000 Building $120,000 Mortgage Payable $320,000 1-Oct Store Fixeture $7,200 Notes Payable $7,200 3-Oct Mercandise Inventory $124,000 Accounts Payable $124,000 15-Oct Utilities expenses $200 Cash $200 31-Oct Cash $149,800 Sales $140,000 Sales Tax payable (140000*7%) $9,800 Cost of good sold $84,000 Mercandise Inventory $84,000 Warranty expenses $8,400 Warranty payable (140000*6%) $8,400 31-Oct payroll amt not given 31-Oct payroll amt not given 1-Nov Interest expenses (320000*5%*1/12) 1333 Mortgage Payable (4000-1333) 2667 Cash 4000 3-Nov Accounts Payable $124,000 Cash $124,000 10-Nov Mercandise Inventory $200,000 Accounts Payable $200,000 12-Nov Treasury stock (400*12) 4800 Cash 4800 15-Nov As payroll fogures not provided hence cannot make this entry 15-Nov Sales Tax payable (140000*7%) $9,800 Cash $9,800 16-Nov Warranty payable $2,500 Cash 2500 17-Nov Cash Dividends (38000-400)*1 $37,600 Dividends Payable—Common $37,600 18-Nov Utilities expenses $260 Cash $260 27-Nov Dividends Payable—Common $37,600 Cash $37,600 30-Nov Cash $190,000 Sales $190,000 Sales Tax payable (190000*7%) $13,300 Cost of good sold $114,000 Mercandise Inventory $114,000 Warranty expenses $6,840 Warranty payable (190000*6%) $6,840 30-Nov payroll amt not given payroll amt not given 1-Dec Interest expenses (320000-2667*5%*1/12) 1322 Mortgage Payable 2678 Cash 4000 10-Dec Accounts Payable $200,000 Cash $200,000 12-Dec Warranty payable $7,300 Cash 2500 15-Dec Cash (200*16) 3200 Paid-in Capital from Treasury Stock Transactions 800 Treasury stock (200*12) 2400 15-Dec Sales Tax payable $13,300 Cash $13,300 18-Dec Utilities expenses $210 Cash $210 19-Dec Mercandise Inventory $85,000 Accounts Payable $85,000 31-Dec Cash $160,000 Sales $160,000 Sales Tax payable (190000*7%) $11,200 Cost of good sold $96,000 Mercandise Inventory $96,000 Warranty expenses $5,760 Estimated Warranty payable (160000*6%) $5,760