Stanford University Operations And Supply Chain Management Assignment Help - econ

Question - 1. (25 points) Lloyd Christmas, Ltd.'s accounting records reflect the following account balances
atJanuary 1, 2005 (beginning of the year):
Account Debit Credit
Equipment $160,000
Inventory $ 95,000
Accounts Receivable $ 20,000
Building $100,000
Cash $ 150,000
Supplies $ 12,000
Prepaid Rent $ 15,000
Land $100,000
Unearned Revenues $50,000
Accounts Payable $60,000
Accumulated Depreciation - Equipment $30,000
Accumulated Depreciation - Bldg $50,000
Note Payable $140,000
Owners' Capital $322,000
This company uses the perpetual inventory system (therefore, the company records a decrease to
inventory and COGS expense for every sale). There were no owner investments or owner
withdrawals for the year. Make the foll ...Read More owing adjustments for the year ended December 31, 2005:
Example: The company made a sale of services on credit. (see table below for entry)
1) The Prepaid Rent for Lloyd Christmas Ltd. was paid on December 31, 2004 (the journal entry for
the initial prepayment has already been made). The lease was for three years. Make the adjustment
for the expired rent at December 31, 2005 (for the whole year).
2) The note payable was taken out last year. The note carries an annual interest rate of 10%. Interest
needs to be accrued for theentire year. The interest will be paid February 8th, 2006 (next year).
Record the adjustment necessary at December 31, 2005.
3) Employee salaries in the amount of $60,000 were incurred for the year. Of that amount, $50,000
had been paid in cash, the remainder was still owed to employees at the end of the year. Record the
journal entry necessary at December 31, 2005 to account for both the paid and unpaid portion of
salaries.
4) At the end of the year, $3,000 of the supplies remained on hand. Record the adjustment necessary
at December 31, 2005.
5) The company paid $20,000 on their accounts payable during the year. Record the entry.
6) The company made sales of merchandise (inventory) to customers for a total $250,000. The sales
were made half on credit, and half in cash. The inventory sold had originally cost the company
$90,000 (hint: this is your cost of goods sold expense).

7) The company provided the services associated with the Unearned Revenues balance at the
beginning of the year. Record the adjustment necessary for the year 2005.
8) At December 31, the company had earned $30,000 in tax consulting revenue, but had not yet
received payment from their customer. Record the adjustment necessary at December 31, 2005.
9) On December 31, received $22,000 in cash representing advance payment for services to be
provided in February of 2006. Record the adjustment necessary at December 31, 2005.
10) The building has a useful life of 25 years and no salvage value. The equipment has a useful of 10
years and has a $20,000 salvage value. Record the adjustments necessary at December 31, 2005
(record the entire year's depreciation for both the building and equipment).
11) Taxes for the year totaled $30,000. The taxes will be paid next year. Record the adjustment
necessary at December 31, 2005.
Required:
A. Record the preceding transactions in the journal below. Make sure to indicate each account
affected by the transactions.
B. Record the transactions from step A. in the ledger (use the T accounts provided below.)
C. Prepare an ending trial balance at December 31, 2005.
D. Prepare an income statement for Lloyd Christmas for 2005.
E. Prepare a statement of owners' equity for the year ended December 31, 2005.
F.Prepare a balance sheet for Lloyd Christmas at December 31, 2005. ...Read Less

Solution Preview - No Solution Preview Available

Original Question Documents

N/A