customers. This is Mason's first year of operations and they have hired you as their CPA to prepare the income statement and balance sheet for their company. As such, January 1st , 2019 was the first day that Mason was in business. For the month of January, record all the necessary journal entries for transactions that occurred during the month. In addition, please prepare all necessary adjusting journal entries as of the end of the month. From the information below, please fill out the "journal entries tab" for all the necessary journal entries. Furthermore, please complete the "T-Accounts" tab for the individual accounts so that the trial balance tab can be updated (automatically). I prepared the first journal entry for you in the journal entries tab and T-Accounts tab. Ensure you label the entries similar to how I have shown in Entry #1. Once all entries are recored and the T-Accounts tab is updated, please prepare the financial statements (income statement and balance sheet) for the month of January.

I just need help in the T-Accounts only

Journal Entry #1

Mason Automotive sells 20,000,000 shares at $1 par for $20 on January 1st, 2019.

Journal Entry #2

Ed Mason, the CEO, hires 4,500 employees, whom will receive a combined salary of $5 Million on a monthly basis. The employees started on January 1st and will be paid for the month of January on February 4th. Employee's withholdings are as follows: 10% for federal income taxes 5.5% for state income taxes and 9% for FICA. Record the necessary entry as of January 1st, 2019.

Journal Entry #3

On January 20th, Mason Automotive decides to purchase 100,000 shares of Treasury stock at $23 per share.

Journal Entry #4

Mason Automotive issues a bond payable on January 1st, 2019 with a face value of $100 Million at 97. The bond will have a useful life of 20 years with an interest payment of 6% (Annual Percentage Rate) due at the end of the month. Record the necessary journal entry as of January 1st, 2019.

(Note: When considering the amortization of the discount or premium, assume the straight line method is used).

Journal Entry #5

On January 1st, Mason Automotive receives $50 Million advance payment from a customer, Highland Inc., to manufacture 5,000 cars.

Journal Entry #6

Mason Automotive purchased $253 Million dollars worth of inventory on January 2nd, 2019. $87 Million was paid with cash with the remaining balance on account. Mason notes that it will use a perpetual inventory system to track inventory.

Journal Entry #7

On January 2nd, Mason Automotive shipped an order to Panther Paws Corporation. The shipping terms were FOB shipping point. The sales value of the order was $207 Million and the inventory cost was $157 Million. Assume that this sale was made on account.

Journal Entry #8

Mason Automotive pre-pays for Rent Expense for the next year of $15.6 Million on January 3rd, 2019.

Journal Entry #9

Mason Automotive purchased $5 Million dollars worth of supplies on account on January 2nd, 2019.

Journal Entry #10

Mason Automotive buys a patent from Apple for $21 Million on January 3rd, 2019. The patent has a legal life of 25 years and useful life of 20 years. Record the necessary entry as of January 3rd, 2019. Assume the patent was purchased using cash.

Journal Entry #11

Mason Automotive purchases fixed assets of $170 Million that will have a useful life of 20 years and a salvage value of $20 million on January 4th, 2019. $30 million was paid with cash with the remaining balance on account. These assets are depreciated using the straight-line method.

Prepare a balance sheet for the month of January

Answer rating: 100% (QA)

Fig in Mlns No Date Account Title Debit Credit 1 Jan 12019 Cash 400 Common stock 20 APICCommon stock 380 2 Salaries expense 5 Federal Income tax withh... View the full answer