Question: Norman Kluz bid for and won a concession to rent

Norman Kluz bid for and won a concession to rent bicycles in the local park during the summer. During June, he completed the following transactions for his business:
June 2 Began business by placing $14,400 in a business checking account in the name of the corporation in exchange for 14,400 shares of $1 par value common stock.
3 Purchased supplies on account for $300.
4 Purchased 10 bicycles for $5,000, paying $2,400 down and agreeing to pay the rest in 30 days.
5 Paid $5,800 in cash for a small shed to store the bicycles and to use for other operations.
8 Paid $800 in cash for shipping and installation costs (considered an addition to the cost of the shed) to place the shed at the park entrance.
9 Hired a part-time assistant to help out on weekends at $7 per hour.
10 Paid a maintenance person $150 to clean the grounds.
13 Received $1,940 in cash for rentals.
17 Paid $300 for the supplies purchased on June 3.
18 Paid a $110 repair bill on bicycles.
23 Billed a company $220 for bicycle rentals for an employee outing.
25 Paid the $200 fee for June to the Park District for the right to operate the bicycle concession.
27 Received $1,920 in cash for rentals.
29 Paid the assistant wages of $480.
30 Declared and paid a dividend of $1,000.

1. Prepare journal entries for Kluz’s transactions in June.
2. Set up the following T accounts and post all the journal entries: Cash, Accounts Receivable, Supplies, Shed, Bicycles, Accounts Payable, Common Stock, Dividends, Rental Revenue, Wages Expense, Maintenance Expense, Repair Expense, and Concession Fee Expense.
3. Prepare a trial balance for Kluz Rentals, Inc., as of June 30, 2011.
4. Compare and contrast how the issues of recognition, valuation, and classification are settled in the transactions of June 3 and 10.

Sale on SolutionInn
  • CreatedSeptember 10, 2014
  • Files Included
Post your question