I need help with general journal entries, please.

CASE STUDY vii. Simulate closing the books as of January 31 using the SAP utility. (Do not enter closing entries into the general ledger. These entries would be done automatically through the SAP month-end closing finction.) Instructions for using the SAP ERP system start on page 13 of this document. Account Balances as of December 31, 2018 Debit Balance $277,518 92,670 Credit Balance 100000 Bank Account 110100 Accounts Receivable (Direct Posting Account) 110150 Allowance for Bad Debts 200600 Inventory-Operating Supplies 200900 Inventory-Raw Materials (Direct Post) 200910 Inventory-Finished Goods (Direct Post) 200920 Inventory-Trading Goods (Direct Post) 210000 Prepaid Insurance 212000 Prepaid Advertising 220110 Land (Direct Post) 220210 Production Machinery, Equip & Fixtures (Dir.Post) 220310 Accumulated Depreciation-Machinery (Direct Post) 300200 Accounts Payable (Direct Posting Account) 300700 Payables-Salaries and Wages 300800 Accrued Expenses Payable 320000 Accrued Tax - Output 329000 Common Stock 329100 Additional Paid-in-Capital 330010 Retained Eamings (Direct Posting) 2,500 8,832 52,000 281,298 66,474 5,000 1,100 425,000 915,000 305,000 48,000 94,313 1,200 3,000 1,000,000 52,870 618,009 CASE STUDY Events During January 2019 Event Date Employees are paid monthly on the first business day of the month for work done in the previous month. (gnore payroll taxes for this assignment.) Accounting wrote and distributed the paychecks 1 January 3 GBI received $60,000 in safety product inventory and $40,000 in raw materials from Dallas Bike Basics. This inventory was ordered on December 28. The payment terms for the invoice total of $100,000 are net 10 days. GBI paid the CWX shipping company $500 with a manual check for the shipment of the goods. The bill of lading showed that the safety product inventory arrived in 6 boxes with a total weight of 50 lbs. and the raw materials came on a pallet and weighed 60 lbs. Shipping charges are allocated based on weight Windy City Bikes in Chicago, L ordered $22,000 of bicycle cost of the accessories (DGB) is | accessories from GBL $15,000. The goods were shipped to Windy City immediately via UPS using Windy City's UPS shipping number. The terms of payment for Windy City's order are 3/10 net 30 days. The 4 January 7 GBI received payment of $14,000 from Northwest Bikes in Seattle, WA for the balance due on their account. GBrs account on the utbility company website is updated at the end of each month when the meter is read. GBI uses this data to 5 January 10 accrue the expenses at the end of each month (in this case on December 31st) This allows recognition of the expense in the correct period. Expenses are usually accrued at the end of the month as 'Accrued Expenses". GBI paid the December utility bill via the company's automatic electronic bill pay progranm. GBrs advertisement in the English language edition of Italian Cycling Journal was published today. This ad was prepaid at the end of July for six months of advertising, August through January. Five months of advertising have already been used.) The office manager in San Diego ordered $432 of office (operating) supplies from Staples. While on the way back from a delivery, one of the warehouse staff picked up the Staples order and brought it to GBI's office. GBI has an account with Staples and payment terms are net 10. Operating supplies expense is figured at the end of the month determined by the amountdf supplies used during the month 7 January 11 SAP AG Page 9 CASE STUDY a GBI ordered $75000 in raw materials from Space Bike Composites in Houston, TX. Terms of payment to Space Bikes are net 30. GBI received payment from Windy City Bikes for their order from January 3. Windy City paid the invoice amount less the discount for paying within 10 days 9 10 January 12 GBI paid $100,000 wa bank transfer for the inventory order that hey received from Dallas Bike Basics January 3. n order to better track inventory, GBI ordered a bar-coding and tracking system which will be installed and tested by Computer Specialists, Ihc. (CS). The system will allow employees to track inventory using mobile devices and special software which will link into their new computerized accounting system. The barcode system costs $6,000 (including sales tax) and CSI will charge GBI $1,300 for the installation and tests. GBI paid a deposit of $2,000 on the system and the remainder is due and payable when the system is installed. GBI will classify the bar-coding system as Production Machinery, Equipment and Fixtures GBI paid an invoice from Lightbulb Accessory Kits for ordered goods that were received on December 20. The amount of the invoice from Lightbulb is $15,890 due net 30 11 January 13 12 January 17 13 The city of Denver will be hosting a decathlon at the end of February. The event is expected to create demand for high quality bikes. Rocky Mountain Bikes in Denver, CO placed an order with GBI for $128,000 worth of bicycles to be delivered immediately Rocky Mountain will pay the shipping. The bikes cost GBI $78000. GBI shipped the order immediately so that Rocky Mountain can start promoting the bikes. Because Rocky Mountain is a good customer, GBI is giving them special terms of net 45 days on this order GBI received raw materials inventory ordered from Space Bike Composites January 11. Shipping charges of $600 were included in the invoice from Space Bike. 14 GBI received notice that Bunky's Bicycle Emporium had declared 15 section 13 bankruptcy which meant GBI would not be able to collect the $3,350 that Bunky's owed them. GBI received a $90.000 funds transfer from Silicon Valley Bikes in 6 daruany 1 Palo Alto for the balance due on their account GBI paid Staples for the office supplies they received January 11. 17 January 19 SoCal Bikes in Irvine, CA placed an order for $2500 in bicycle helmets for a special event in February. The merchandise cost GBI 1300. SoCal sent a truck to the GBI distribution center in San 18 O SAP AG Page 10 CASE STUDY Diego, CA and picked up the merchandise directy from GBrs warehouse. Terms of payment are net 30. (Don't forget to charge sales tax of 6.00% for this order.) Beantown Bikes in Boston, MA placed an order with GBI for $27,000 in bicycles. The cost of the bicycles is $17,000. Beantown Bikes is a new customer. Its buyers saw GBrs booth at a trade show. Because Beantown is a new customer, they must either wait until their credit can be approved or pay for the order before GBI will ship the bikes to them 19 January 24 GBI has been offered the opportunity to advertise in the Bicycle 20 Times online magazine for a reduced price if they pay for three months in advance. In light of the upcoming Tour de France, the advertising is a great opportunity for GBI to get additional recognition. The advertising will start in February. GBl wrote a check for $9,000 for three months of advertising 21 January 26 GBI received notificaton from their bank that Beantown Binkes had transferred funds into their account for their prior order, so GBrs warehouse personnel shipped Beantown's order. Beantown will be responsible for paying Fed-X $400 for shipping the order 22 January 27 The county approved GBrs building plans for their new warehouse. Estmated building costs are $1,100,000 which will be funded via a mortgage from Bank of America. GBI plans to break ground on the new building April 18h of this year GBI sent a $31,000 check to Night Rider Aluminum Products for an order of bicycle parts GBI received December 30th. 23 Big Apple Bikes in New York City is expanding to another location in New York and needs to stock the new location. GBI received a 24 phone order from Big Apple for $230,000 in bicycles and $108,500 n bicycle accessories and safety gear at special discount prices. The cost of the bicycles in this order is $170000 and the cost of the accessories is $65,000. Big Apple will have a contract trucking company pick up the order when it is ready. The order is sent to GBIs warehouse for picking and packing, which may take a couple days. Payment terms to Big Apple for this order are net 30 GBI pays sales tax once a quarter via the state's electronic fling and payment system. GBl filed its retum and paid its sales tax for the quarter ending December 31 GBI paid February's rent of $4,000 for the office and warehouse space in San Diego 25 January 26 27 CSI installed and tested the new barcode system. The warehouse manager approved the installation and commented that she thinks it works great. GBI wrote a check to CSI for the balance owed and gave it to the installer O SAP AG Page 11 CASE STUDY Big Apple's truck arrived at GBr's warehouse and picked up the order from January 27th 28 Adjustment information as of January 31, 2019 not already given in the original transaction(s): 1. Based on prior experience, GBI estimates that approximately 2 % of the accounts receivable balance will become bad debt. GBI writes off bad debts as they occur and recognizes bad debt expense based on analying accounts receivable as an adjusting entry each month. 2. As a control measure, physical inventories are taken on a periodic basis alternating between the raw materials inventory, finished goods inventory and trading goods inventory. Physical inventory of the finished goods inventory was taken at the end of January. I was determined that the value of the finished goods merchandise on hand was $17,000. 3. GBI counted the office (operating) supplies on hand after the close of business on the last day of the month and determined the cost of the unused office supplies to be $1000. 4. Production Machinery, Equipment and Fixtures were placed in service on January 1, 2014, with an expected service life of 15 years and no salvage value. The bar-code system has a 5-year life and no salvage value. GBI depreciates fixed assets on a straight-line basis and those assets acquired in the first half of the months are depreciated for the entire month, while fixed assets placed in service during the last half of the month are not depreciated until the second month. Depreciation is rounded to the nearest dollar and assets are depreciated on a monthly basis (i.e. number of days in the month is not of consequence). 5. GBI used the Intenet to review the monthly charges for ubilities the business consumed during January. Based on the Internet report, the amount to be billed by the utilities company for January usage is the same as was billed for December. 6. Liability insurance for the six-month period ending on February 28, 2019 was paid last September on the first of the month. Liability insurance is assumed to be utilized uniformly over the six-month policy period. 7. GBI needs to recognize the wages expense for the month. Since all employees are paid salaries and no changes have been made, this amount is the same as the previous month salaries. (For purposes of this assignment, ignore manufacturing and assume all labor costs will be expensed.) OSAP AG Page 12 CASE ST Account G/L Acct Long Text 100000 110100 Accounts Receivable (Direct Posting Account) 110150 Allowance for Bad Debts 110200 Interest Receivable 200600 Inventory-Operating Supplies 200900 Inventory-Raw Materials (Direct Post) 200910 Inventory-Finished Goods (Direct Post) 200920 Inventory-Trading Goods (Direct Post) 200930 Inventory-Semi-finished Goods (Direct Post) 210000 Prepaid Insurance 211000 Prepaid Supplies 212000 Prepaid Advertising 215000 Prepaid Rent 216000 Deposits on Purchases 220000 Notes Receivable 220110 Land (Direct Post) 220210 Production Machinery, Equip & Fixtures (Dir.Post) 220310 Accumulated Depreciation-Machinery (Direct Post) 220400 Office Furniture 220500 Accumulated Depreciation-Office Furniture 220600 Office Equipment and Computers Bank Account Accumulated Depreciation-Office Equipment Payables-Income Taxes Accounts Payable (Direct Posting Account) 300100 300200 300300 300400 300500 300600 300700 300800 310000 320000 321000 322000 329100 330010 600000 610000 620000 630000 640000 650000 650100 700000 720000 720100 720200 Payables-Short-Term Notes Payables-Long-Term Notes Payables-Commissions Payables Salaries and Wages Accrued Expenses Goods Receipt/ Invoice Receipt Account Accrued Tax - Output Accrued Tax- Input Unearned Revenues Common Stock Additional Paid-in-Capital Retained Earnings (Direct Post) Sales Revenue Sales Discount Miscellaneous Revenue Revenue Deductions Gain or Loss on Sale of Assets Customer Service Revenue Customer Service Revenue Settlement Labor (Salaries and Wage Expense) Raw Material Consumption Expense Finished Product Consumption Expense Trading Good Consumption Expense OSAP AG CASE S 720300 740000 740100 740200 740300 740400 740500 740600 740700 Semi-Finished Consumption Expense Supplies Expense Telephone and Internet Expense Legal and Professional Expense Rent Expense Insurance Expense Payroll Expense-Office Payroll Expense-Administrative Sales Expense 740800 Tax Expense Property 740900 Tax Expense- Income 741000 Miscellaneous Expense 741200 Bad Debt Expense 741300 Information Technology Expense Account 741400 Production Order Variance Expense Account 741500 Utilities Expense (Electricity & Phone 741600 Manufacturing Output settlement 741700 Manufacturing Output Settlement Variance 741800 Depreciation Expense 741900 Advertising Expense 742000 Vendor Discounts Missed 742100 Shipping Expense 760000Purchase Price Difference 760100 Production Variance 770000 Research and Development 780000 Cost of Goods Sold CASE STUDY vii. Simulate closing the books as of January 31 using the SAP utility. (Do not enter closing entries into the general ledger. These entries would be done automatically through the SAP month-end closing finction.) Instructions for using the SAP ERP system start on page 13 of this document. Account Balances as of December 31, 2018 Debit Balance $277,518 92,670 Credit Balance 100000 Bank Account 110100 Accounts Receivable (Direct Posting Account) 110150 Allowance for Bad Debts 200600 Inventory-Operating Supplies 200900 Inventory-Raw Materials (Direct Post) 200910 Inventory-Finished Goods (Direct Post) 200920 Inventory-Trading Goods (Direct Post) 210000 Prepaid Insurance 212000 Prepaid Advertising 220110 Land (Direct Post) 220210 Production Machinery, Equip & Fixtures (Dir.Post) 220310 Accumulated Depreciation-Machinery (Direct Post) 300200 Accounts Payable (Direct Posting Account) 300700 Payables-Salaries and Wages 300800 Accrued Expenses Payable 320000 Accrued Tax - Output 329000 Common Stock 329100 Additional Paid-in-Capital 330010 Retained Eamings (Direct Posting) 2,500 8,832 52,000 281,298 66,474 5,000 1,100 425,000 915,000 305,000 48,000 94,313 1,200 3,000 1,000,000 52,870 618,009 CASE STUDY Events During January 2019 Event Date Employees are paid monthly on the first business day of the month for work done in the previous month. (gnore payroll taxes for this assignment.) Accounting wrote and distributed the paychecks 1 January 3 GBI received $60,000 in safety product inventory and $40,000 in raw materials from Dallas Bike Basics. This inventory was ordered on December 28. The payment terms for the invoice total of $100,000 are net 10 days. GBI paid the CWX shipping company $500 with a manual check for the shipment of the goods. The bill of lading showed that the safety product inventory arrived in 6 boxes with a total weight of 50 lbs. and the raw materials came on a pallet and weighed 60 lbs. Shipping charges are allocated based on weight Windy City Bikes in Chicago, L ordered $22,000 of bicycle cost of the accessories (DGB) is | accessories from GBL $15,000. The goods were shipped to Windy City immediately via UPS using Windy City's UPS shipping number. The terms of payment for Windy City's order are 3/10 net 30 days. The 4 January 7 GBI received payment of $14,000 from Northwest Bikes in Seattle, WA for the balance due on their account. GBrs account on the utbility company website is updated at the end of each month when the meter is read. GBI uses this data to 5 January 10 accrue the expenses at the end of each month (in this case on December 31st) This allows recognition of the expense in the correct period. Expenses are usually accrued at the end of the month as 'Accrued Expenses". GBI paid the December utility bill via the company's automatic electronic bill pay progranm. GBrs advertisement in the English language edition of Italian Cycling Journal was published today. This ad was prepaid at the end of July for six months of advertising, August through January. Five months of advertising have already been used.) The office manager in San Diego ordered $432 of office (operating) supplies from Staples. While on the way back from a delivery, one of the warehouse staff picked up the Staples order and brought it to GBI's office. GBI has an account with Staples and payment terms are net 10. Operating supplies expense is figured at the end of the month determined by the amountdf supplies used during the month 7 January 11 SAP AG Page 9 CASE STUDY a GBI ordered $75000 in raw materials from Space Bike Composites in Houston, TX. Terms of payment to Space Bikes are net 30. GBI received payment from Windy City Bikes for their order from January 3. Windy City paid the invoice amount less the discount for paying within 10 days 9 10 January 12 GBI paid $100,000 wa bank transfer for the inventory order that hey received from Dallas Bike Basics January 3. n order to better track inventory, GBI ordered a bar-coding and tracking system which will be installed and tested by Computer Specialists, Ihc. (CS). The system will allow employees to track inventory using mobile devices and special software which will link into their new computerized accounting system. The barcode system costs $6,000 (including sales tax) and CSI will charge GBI $1,300 for the installation and tests. GBI paid a deposit of $2,000 on the system and the remainder is due and payable when the system is installed. GBI will classify the bar-coding system as Production Machinery, Equipment and Fixtures GBI paid an invoice from Lightbulb Accessory Kits for ordered goods that were received on December 20. The amount of the invoice from Lightbulb is $15,890 due net 30 11 January 13 12 January 17 13 The city of Denver will be hosting a decathlon at the end of February. The event is expected to create demand for high quality bikes. Rocky Mountain Bikes in Denver, CO placed an order with GBI for $128,000 worth of bicycles to be delivered immediately Rocky Mountain will pay the shipping. The bikes cost GBI $78000. GBI shipped the order immediately so that Rocky Mountain can start promoting the bikes. Because Rocky Mountain is a good customer, GBI is giving them special terms of net 45 days on this order GBI received raw materials inventory ordered from Space Bike Composites January 11. Shipping charges of $600 were included in the invoice from Space Bike. 14 GBI received notice that Bunky's Bicycle Emporium had declared 15 section 13 bankruptcy which meant GBI would not be able to collect the $3,350 that Bunky's owed them. GBI received a $90.000 funds transfer from Silicon Valley Bikes in 6 daruany 1 Palo Alto for the balance due on their account GBI paid Staples for the office supplies they received January 11. 17 January 19 SoCal Bikes in Irvine, CA placed an order for $2500 in bicycle helmets for a special event in February. The merchandise cost GBI 1300. SoCal sent a truck to the GBI distribution center in San 18 O SAP AG Page 10 CASE STUDY Diego, CA and picked up the merchandise directy from GBrs warehouse. Terms of payment are net 30. (Don't forget to charge sales tax of 6.00% for this order.) Beantown Bikes in Boston, MA placed an order with GBI for $27,000 in bicycles. The cost of the bicycles is $17,000. Beantown Bikes is a new customer. Its buyers saw GBrs booth at a trade show. Because Beantown is a new customer, they must either wait until their credit can be approved or pay for the order before GBI will ship the bikes to them 19 January 24 GBI has been offered the opportunity to advertise in the Bicycle 20 Times online magazine for a reduced price if they pay for three months in advance. In light of the upcoming Tour de France, the advertising is a great opportunity for GBI to get additional recognition. The advertising will start in February. GBl wrote a check for $9,000 for three months of advertising 21 January 26 GBI received notificaton from their bank that Beantown Binkes had transferred funds into their account for their prior order, so GBrs warehouse personnel shipped Beantown's order. Beantown will be responsible for paying Fed-X $400 for shipping the order 22 January 27 The county approved GBrs building plans for their new warehouse. Estmated building costs are $1,100,000 which will be funded via a mortgage from Bank of America. GBI plans to break ground on the new building April 18h of this year GBI sent a $31,000 check to Night Rider Aluminum Products for an order of bicycle parts GBI received December 30th. 23 Big Apple Bikes in New York City is expanding to another location in New York and needs to stock the new location. GBI received a 24 phone order from Big Apple for $230,000 in bicycles and $108,500 n bicycle accessories and safety gear at special discount prices. The cost of the bicycles in this order is $170000 and the cost of the accessories is $65,000. Big Apple will have a contract trucking company pick up the order when it is ready. The order is sent to GBIs warehouse for picking and packing, which may take a couple days. Payment terms to Big Apple for this order are net 30 GBI pays sales tax once a quarter via the state's electronic fling and payment system. GBl filed its retum and paid its sales tax for the quarter ending December 31 GBI paid February's rent of $4,000 for the office and warehouse space in San Diego 25 January 26 27 CSI installed and tested the new barcode system. The warehouse manager approved the installation and commented that she thinks it works great. GBI wrote a check to CSI for the balance owed and gave it to the installer O SAP AG Page 11 CASE STUDY Big Apple's truck arrived at GBr's warehouse and picked up the order from January 27th 28 Adjustment information as of January 31, 2019 not already given in the original transaction(s): 1. Based on prior experience, GBI estimates that approximately 2 % of the accounts receivable balance will become bad debt. GBI writes off bad debts as they occur and recognizes bad debt expense based on analying accounts receivable as an adjusting entry each month. 2. As a control measure, physical inventories are taken on a periodic basis alternating between the raw materials inventory, finished goods inventory and trading goods inventory. Physical inventory of the finished goods inventory was taken at the end of January. I was determined that the value of the finished goods merchandise on hand was $17,000. 3. GBI counted the office (operating) supplies on hand after the close of business on the last day of the month and determined the cost of the unused office supplies to be $1000. 4. Production Machinery, Equipment and Fixtures were placed in service on January 1, 2014, with an expected service life of 15 years and no salvage value. The bar-code system has a 5-year life and no salvage value. GBI depreciates fixed assets on a straight-line basis and those assets acquired in the first half of the months are depreciated for the entire month, while fixed assets placed in service during the last half of the month are not depreciated until the second month. Depreciation is rounded to the nearest dollar and assets are depreciated on a monthly basis (i.e. number of days in the month is not of consequence). 5. GBI used the Intenet to review the monthly charges for ubilities the business consumed during January. Based on the Internet report, the amount to be billed by the utilities company for January usage is the same as was billed for December. 6. Liability insurance for the six-month period ending on February 28, 2019 was paid last September on the first of the month. Liability insurance is assumed to be utilized uniformly over the six-month policy period. 7. GBI needs to recognize the wages expense for the month. Since all employees are paid salaries and no changes have been made, this amount is the same as the previous month salaries. (For purposes of this assignment, ignore manufacturing and assume all labor costs will be expensed.) OSAP AG Page 12 CASE ST Account G/L Acct Long Text 100000 110100 Accounts Receivable (Direct Posting Account) 110150 Allowance for Bad Debts 110200 Interest Receivable 200600 Inventory-Operating Supplies 200900 Inventory-Raw Materials (Direct Post) 200910 Inventory-Finished Goods (Direct Post) 200920 Inventory-Trading Goods (Direct Post) 200930 Inventory-Semi-finished Goods (Direct Post) 210000 Prepaid Insurance 211000 Prepaid Supplies 212000 Prepaid Advertising 215000 Prepaid Rent 216000 Deposits on Purchases 220000 Notes Receivable 220110 Land (Direct Post) 220210 Production Machinery, Equip & Fixtures (Dir.Post) 220310 Accumulated Depreciation-Machinery (Direct Post) 220400 Office Furniture 220500 Accumulated Depreciation-Office Furniture 220600 Office Equipment and Computers Bank Account Accumulated Depreciation-Office Equipment Payables-Income Taxes Accounts Payable (Direct Posting Account) 300100 300200 300300 300400 300500 300600 300700 300800 310000 320000 321000 322000 329100 330010 600000 610000 620000 630000 640000 650000 650100 700000 720000 720100 720200 Payables-Short-Term Notes Payables-Long-Term Notes Payables-Commissions Payables Salaries and Wages Accrued Expenses Goods Receipt/ Invoice Receipt Account Accrued Tax - Output Accrued Tax- Input Unearned Revenues Common Stock Additional Paid-in-Capital Retained Earnings (Direct Post) Sales Revenue Sales Discount Miscellaneous Revenue Revenue Deductions Gain or Loss on Sale of Assets Customer Service Revenue Customer Service Revenue Settlement Labor (Salaries and Wage Expense) Raw Material Consumption Expense Finished Product Consumption Expense Trading Good Consumption Expense OSAP AG CASE S 720300 740000 740100 740200 740300 740400 740500 740600 740700 Semi-Finished Consumption Expense Supplies Expense Telephone and Internet Expense Legal and Professional Expense Rent Expense Insurance Expense Payroll Expense-Office Payroll Expense-Administrative Sales Expense 740800 Tax Expense Property 740900 Tax Expense- Income 741000 Miscellaneous Expense 741200 Bad Debt Expense 741300 Information Technology Expense Account 741400 Production Order Variance Expense Account 741500 Utilities Expense (Electricity & Phone 741600 Manufacturing Output settlement 741700 Manufacturing Output Settlement Variance 741800 Depreciation Expense 741900 Advertising Expense 742000 Vendor Discounts Missed 742100 Shipping Expense 760000Purchase Price Difference 760100 Production Variance 770000 Research and Development 780000 Cost of Goods Sold