On November 30, 2016, Davis Company had the following account balances:
During the month of December, Davis entered into the following transactions:
Date Transaction
Dec. 4 Made cash sales of $3,000; the cost of the inventory sold was $1,800.
7 Purchased $2,400 of inventory on credit.
14 Collected $900 of accounts receivable.
18 Sold land for $7,800; the land originally cost $5,000.
20 Made credit sales of $4,000; the cost of the inventory sold was $2,400.
21 Returned $360 of defective inventory to supplier for credit to the Davis Company’s account.
27 Purchased $1,250 of inventory for cash.
28 Paid $1,100 of accounts payable.
31 Purchased land at a cost of $6,000; made a $ 1,000 down payment and signed a 12%, 2-year note for the balance.
1. Prepare general journal entries to record the preceding transactions.
2. Post to general ledger T-accounts.
3. Prepare a year-end trial balance on a worksheet and complete the worksheet using the following information: (a) accrued salaries at year-end total $1,200; (b) for simplicity, the building and equipment are being depreciated using the straight-line method over an estimated life of 20 years with no residual value; (c) supplies on hand at the end of the year total $630; (d) bad debts expense for the year totals $830; and (e) the income tax rate is 30%; income taxes are payable in the first quarter of 2017.
4. Prepare the company’s financial statements for 2016.
5. Prepare the 2016
(a) Adjusting
(b) Closing entries in the general journal.

  • CreatedOctober 05, 2015
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