Intelligent Toys, Inc (ITI) is a well establish toys trading company which adopts the periodic system....
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Intelligent Toys, Inc ("ITI") is a well establish toys trading company which adopts the periodic system. ITI prepares its financial statements on a monthly basis. The trial balance of ITI as at 29 February 2020 is presented as follows: Intelligent Toys, Ine Trial Balance As at 29 February 2020 Account No. Account Title Debit Credit (S) (S) 201 Accounts Payable 280,000 112 Accounts Receivable 450.000 496,800 152 Accumulated Depreciation - Building 154 Accumulated Depreciation - Equipment 156 Accumulated Depreciation - Motor Vehicle 113 Allowance for Doubtful Accounts 151 Building 101 Cash 291 Dividends Payable 380,000 443,112 13,500 6,480,000 667.680 80,000 660,000 153 Equipment 115 Interest Receivable 96.000 500,000 140 Long-term Investment Merchandise Inventory 121 650,000 155 Motor Vehicle 555.000 1,800,000 12,000 114 Notes Receivable 131 Prepaid Insurance 320 Retained Earnings 241 Salaries Payable 311 Share Capital - Ordinary 1,384.808 70.200 SI par value, 5,000.000 shares authorized, 4,000,000 shares issued and 3,985,000 shares outstanding 4,000,000 312 Share Capital - Preference 4%, S100 par value, noncumulative, 50.000 shares authorized, 40,000 shares issued and outstanding 4.000,000 313 Share Premium - Ordinary 560.000 200,000 314 Share Premium- Preference 6.000 315 Share Premium - Treasury 132 Supplies 330 Treasury Shares (15,000 shares) 6,240 37,500 11.914,420 H.914,420 The following information is available on 31 March 2020: (a) Electricity incurred for the month amounted to $4,800. (b) The employees receive a total salary of $27,000 for a five-day work week. All employees worked for the whole month of March. (c) Building, (ii) equipment and (iii) motor vehicles are recorded at historical cost and their estimated useful lives are 50 years, 5 years and 5 years respectively. No residual value is expected for the building. The building was acquired on 1 May 2016. The company uses straight-line method for all buildings. All the equipment and motor vehicles are acquired on 1 January 2017. The company uses unit of activity method to depreciate equipment and the double-declining balance method to depreciate all motor vehicles. The company expects that the salvage value of the equipment and motor vehicles is 10 % of the purchase cost. The equipment is for packing and the total amount of packing for 5 years are estimated to be 594,000 units. The total packing in March amounted to 9,800 units. Annual depreciation is calculated for each year from 1 January to 31 December, monthly depreciation is equal to (annual depreciation / 12). (d) Physical count showed that $3,000 of supplies and (e) S698,000 of merchandise inventory remained on hand at 31 March 2020. () The prepaid insurance was paid in last December covering a 12-month general insurance from January to December, 2020. (g) Allowance for bad debt is estimated based on 10% of the closing accounts receivable balance due to dramatical down turm of the economy. (h) Recognize interest expense for the month. (i) Recognize interest revenue for the month. Page 3 of 3 Requirement 2 (88 points) 2 points for each item Adjusting entries Date Dr/Cr Account No. Amount S (a) Dr Item129 Item 130 Cr Item131 Item 132 (b) Dr Item 133 Item 134 Cr Item135 Item 136 (cXi) Dr Item137 Item 138 Cr Item 139 Item 140 (cXii) Dr Item141 Item 142 Cr Item 143 Item 144 (cxi) Dr Item 145 Item 146 Cr Item147 Item 148 (d) Dr Ihem149 Item 150 Cr Item 151 Item 152 (e) Dr Item153 Item 154 Cr Item155 Item 156 (1) Dr Item157 Item 158 Cr Item159 Item 160 (g) Dr Item 161 Item 162 Cr Item 163 Item 164 (h) Dr Item 165 Item 166 Cr Item167 Item 168 (i) Dr Item169 Item 170 Cr Item 171 Item 172 Page 6 of 12 Chart of Accounts Account No 201 Account Names Account No Account Names Accounts Payable Accounts Receivable Accumulated Depreciation - Building Accumulated Depreciation - Equipment Merchandise Inventory Miscellaneous Expense Motor Vehicle Notes Payable 121 112 630 152 155 154 231 Notes Receivable Ordinary Share Dividends Distributable Prepaid Insurance Purchase Discounts Purchase Returns and Allowances Purchases Retained Earnings Salaries Payable Salaries Expense 156 Accumulated Depreciation - Motor vehicle Allowance for Doubtful Accounts Bad Debt Expense Building Cash 114 113 292 611 131 151 513 101 512 Depreciation Expense - Building Depreciation Expense - Equipment Depreciation Expense - Motor Vehicle Dividends Payable 711 511 712 320 713 241 291 616 153 Equipment Freight-in Freight-out Fuel Expense Gain on Disposal Insurance Expense Interest Expense Interest Payable Interest Receivable Interest Revenue 410 Sales Revenue 514 411 Sales Returns and Allowances Share Capital - Ordinary Share Capital – Preference Share Premium - Ordinary Share Premium - Preference Share Premium - Treasury Supplies Supplies Expense Treasury Shares Unearned Rent Revenue Utilities Expense 612 311 613 312 820 313 615 314 631 315 221 132 115 618 415 330 150 Land 281 Long-term Investment Loss on Disposal 140 619 620 12 Intelligent Toys, Inc ("ITI") is a well establish toys trading company which adopts the periodic system. ITI prepares its financial statements on a monthly basis. The trial balance of ITI as at 29 February 2020 is presented as follows: Intelligent Toys, Ine Trial Balance As at 29 February 2020 Account No. Account Title Debit Credit (S) (S) 201 Accounts Payable 280,000 112 Accounts Receivable 450.000 496,800 152 Accumulated Depreciation - Building 154 Accumulated Depreciation - Equipment 156 Accumulated Depreciation - Motor Vehicle 113 Allowance for Doubtful Accounts 151 Building 101 Cash 291 Dividends Payable 380,000 443,112 13,500 6,480,000 667.680 80,000 660,000 153 Equipment 115 Interest Receivable 96.000 500,000 140 Long-term Investment Merchandise Inventory 121 650,000 155 Motor Vehicle 555.000 1,800,000 12,000 114 Notes Receivable 131 Prepaid Insurance 320 Retained Earnings 241 Salaries Payable 311 Share Capital - Ordinary 1,384.808 70.200 SI par value, 5,000.000 shares authorized, 4,000,000 shares issued and 3,985,000 shares outstanding 4,000,000 312 Share Capital - Preference 4%, S100 par value, noncumulative, 50.000 shares authorized, 40,000 shares issued and outstanding 4.000,000 313 Share Premium - Ordinary 560.000 200,000 314 Share Premium- Preference 6.000 315 Share Premium - Treasury 132 Supplies 330 Treasury Shares (15,000 shares) 6,240 37,500 11.914,420 H.914,420 The following information is available on 31 March 2020: (a) Electricity incurred for the month amounted to $4,800. (b) The employees receive a total salary of $27,000 for a five-day work week. All employees worked for the whole month of March. (c) Building, (ii) equipment and (iii) motor vehicles are recorded at historical cost and their estimated useful lives are 50 years, 5 years and 5 years respectively. No residual value is expected for the building. The building was acquired on 1 May 2016. The company uses straight-line method for all buildings. All the equipment and motor vehicles are acquired on 1 January 2017. The company uses unit of activity method to depreciate equipment and the double-declining balance method to depreciate all motor vehicles. The company expects that the salvage value of the equipment and motor vehicles is 10 % of the purchase cost. The equipment is for packing and the total amount of packing for 5 years are estimated to be 594,000 units. The total packing in March amounted to 9,800 units. Annual depreciation is calculated for each year from 1 January to 31 December, monthly depreciation is equal to (annual depreciation / 12). (d) Physical count showed that $3,000 of supplies and (e) S698,000 of merchandise inventory remained on hand at 31 March 2020. () The prepaid insurance was paid in last December covering a 12-month general insurance from January to December, 2020. (g) Allowance for bad debt is estimated based on 10% of the closing accounts receivable balance due to dramatical down turm of the economy. (h) Recognize interest expense for the month. (i) Recognize interest revenue for the month. Page 3 of 3 Requirement 2 (88 points) 2 points for each item Adjusting entries Date Dr/Cr Account No. Amount S (a) Dr Item129 Item 130 Cr Item131 Item 132 (b) Dr Item 133 Item 134 Cr Item135 Item 136 (cXi) Dr Item137 Item 138 Cr Item 139 Item 140 (cXii) Dr Item141 Item 142 Cr Item 143 Item 144 (cxi) Dr Item 145 Item 146 Cr Item147 Item 148 (d) Dr Ihem149 Item 150 Cr Item 151 Item 152 (e) Dr Item153 Item 154 Cr Item155 Item 156 (1) Dr Item157 Item 158 Cr Item159 Item 160 (g) Dr Item 161 Item 162 Cr Item 163 Item 164 (h) Dr Item 165 Item 166 Cr Item167 Item 168 (i) Dr Item169 Item 170 Cr Item 171 Item 172 Page 6 of 12 Chart of Accounts Account No 201 Account Names Account No Account Names Accounts Payable Accounts Receivable Accumulated Depreciation - Building Accumulated Depreciation - Equipment Merchandise Inventory Miscellaneous Expense Motor Vehicle Notes Payable 121 112 630 152 155 154 231 Notes Receivable Ordinary Share Dividends Distributable Prepaid Insurance Purchase Discounts Purchase Returns and Allowances Purchases Retained Earnings Salaries Payable Salaries Expense 156 Accumulated Depreciation - Motor vehicle Allowance for Doubtful Accounts Bad Debt Expense Building Cash 114 113 292 611 131 151 513 101 512 Depreciation Expense - Building Depreciation Expense - Equipment Depreciation Expense - Motor Vehicle Dividends Payable 711 511 712 320 713 241 291 616 153 Equipment Freight-in Freight-out Fuel Expense Gain on Disposal Insurance Expense Interest Expense Interest Payable Interest Receivable Interest Revenue 410 Sales Revenue 514 411 Sales Returns and Allowances Share Capital - Ordinary Share Capital – Preference Share Premium - Ordinary Share Premium - Preference Share Premium - Treasury Supplies Supplies Expense Treasury Shares Unearned Rent Revenue Utilities Expense 612 311 613 312 820 313 615 314 631 315 221 132 115 618 415 330 150 Land 281 Long-term Investment Loss on Disposal 140 619 620 12
Expert Answer:
Answer rating: 100% (QA)
Journal Entries Date Account Title Explanation Debit Credit Electricity Expenses 4800 a Cash 4800 T... View the full answer
Related Book For
Posted Date:
Students also viewed these accounting questions
-
The Japanese firm Sony prepares its financial statements using U.S. GAAP. Two items related to its inventory appeared in the operating section of the 2009 statement of cash flow, both in millions of...
-
A Franco-Dutch company, prepares its financial statements according to International Financial Reporting Standards. AF's financial statements and disclosure notes for the year ended December 31,...
-
As you examined in this week's Discussion, fair value measurements can influence financial reporting. For an accountant, it can also be considered a moving target, especially when values of certain...
-
The accompanying table shows data from the World Bank, World Development Indicators, for real GDP per capita (2010 U.S. dollars) in France, Japan, the United Kingdom, and the United States in 1960...
-
1. Describe the microcultures that Flight 001 is targeting with the product lines that it sells? 2. How does Flight 001 reach customers in these microcultures? Brad John and John Sencion, co-founders...
-
What are the drawbacks of relying on green equity indices?
-
What is sudden load?
-
Teak Outdoor Furniture manufactures wood patio furniture. The company reports the following costs for June 2012: Wood . . . . . . . . . . . . . . . . . . . . . . . . $ 250,000 Nails, glue, and stain...
-
Coherent light from a laser diode is emitted through a rectangular area 3.0m x 1.5m (horizontal-by-vertical). If the laser light has a wavelength of 680 nm, determine the angle between the first...
-
It is the end of December and Natalie has been in touch with her grandmother. Her grandmother is curious to know if Natalie has been profitable and if Natalie requires another loan to help finance...
-
Q1. Why do you feel there is a movement away from the importance of operational skills to those more strategic in nature? Q2. What has been recognised as currently missing in the skill sets of the...
-
Which of the following accounts of a governmental unit is credited when taxpayers are billed for property taxes? a. Estimated Revenue. b. Revenue. c. Appropriations. d. Fund BalanceAssigned for...
-
How is the composition of FDI sources changing with respect to developed and developing nations?
-
Which of the following situations will increase a governmental units fund balance at the fiscal year-end? a. Appropriations are less than expenditures and budgetary fund balance assigned for...
-
What is the role of exporting and FDI in the international product life cycle theory?
-
The Encumbrances Control account of a governmental unit is debited when a. Goods are received. b. A voucher payable is recorded. c. A purchase order is approved. d. The budget is recorded.
-
How to Calculate taxable income by reducing gross income by adjustments, exemptions, and standard or deductions?
-
Determine the optimal use of Applichem's plant capacity using the Solver in Excel.
-
Hodge Sports bonds are selling on the open market at par value. The bonds have a stated interest rate of 9 percent and mature in five years. You have determined that the risk-free rate is 7 percent....
-
During 2004, American Greeting Corporation, a large producer of greetings cards, repurchased some of its outstanding long-term debt. Shortly thereafter the company issued new debt. At the time of the...
-
Most homeowners purchase their houses by borrowing the funds in what is called a mortgage loan. Banks and other financial institutions that make the mortgage loans often package the loans for resale...
-
Calculate the correlations among all numeric variables in Exercise 9.1 using SPSS, or R. (In R read in the data as a data.frame (e.g., theData) and then use (cor(theData). You dont need to attach...
-
What are the strongest single predictors of infant mortality in Exercise 9.2? Exercise 9.2 Calculate the correlations among all numeric variables in Exercise 9.1 using SPSS, or R. (In R read in the...
-
Using one of the online calculators, how large a correlation would you need for the relationships shown in Exercise 9.2 to be significant? (This will involve a bit of trial and error.) Calculate the...
Study smarter with the SolutionInn App