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Print off worksheets on the following tabs (located in the lower left hand corner of window) COMPLETE BY HAND
Oakwood Light, Inc. balance sheet at 12/31/14 is presented below.
		Oakwood Light Inc.
		Balance Sheet
		12/31/14
Cash	$15,900		Accounts payable	$18,300
Merchandise Inventory	22,700		Common stock ($1 par)	9,000
Prepaid Insurance	1,800		Paid in capital in excess of par	60,000
Equipment	130,000		Retained earnings	41,100
Accumulated depreciation	(42,000)
	$128,400			$128,400
During 2015, the following transactions occurred:
1. Purchased $129,700 inventory on account. Oakwood Light Inc. uses the perpetual method for valuing inventory.
2. $200,000 in sales, plus 5.6% sales tax, were made to customers on account. Cost of the goods sold were $115,600.
3. Received $12,000 cash down payment for orders that will be shipped next year.
4. Issued 10 year, $40,000 face value, 8% bonds on 7/1/15 at 108. The bonds pay interest every 1/1 and 7/1.
5. Collected $165,000 on account.
6. Paid other operating expenses of $28,700.
7. Paid $121,030 on account.
8. Paid $10,000 to the state for a portion of the sales tax collected from customers.
9. On 1/1/15 sold equipment with an original cost of $25,000 for $5,000 cash. The equipment's
accumulated depreciation is $8,500.
10. Issued 1,200 shares of $125 par 8% preferred stock for $180,000 cash.
11. Purchased equipment on 7/1/15 for $95,000 cash.
12. Purchased 500 shares of Oakwood Light Inc. common stock from a disgruntled shareholder for $35 per share.
13. Recorded wage and payroll taxes. Employee gross wages were $40,000, FICA tax was withheld at a 7.65% rate,
federal income taxes (FIT) of $1,800 were withheld, and state income taxes (SIT) of $600 were withheld.
Additionally, the Federal unemployment tax (FUTA) rate is 0.9% and the state unemployment (SUTA) rate is 3.5%.
The net wage checks were cut and immediately given to employees. The payroll taxes are not due to be remitted until
after year end.
Requirement A:
i - Journalize 1 - 13 above
ii - Post to the ledger
iii - Prepare an unadjusted trial balance which will be used as the first 2 columns of a worksheet.
(See Requirement B.)
***Four Optional solution templates have been prepared to assist you. They can be accessed by clicking on
the tabs below.
Requirement B:
Using the unadjusted trial balance prepared in requirement A-iii above and the following data for adjusting
entries, prepare a 10 column worksheet similar to the one in chapter 4 appendix of your text.
(a) Straight-line depreciation, with a 5-year useful life and no salvage value is used for equipment purchased in previous years.
For the 2015 purchase (#11 above) use double declining balance with a useful life of 10 years, and $15,000 salvage value.
(b) Accrue bond interest payable and amortize bond premium as well.
(c) The prepaid insurance relates to a policy purchased last year that expires at a rate of $80 per month.
(d) Oakwood Light estimates that all accounts receivable are collectible--in other words, don't worry about bad debts.
Requirement C:
Prepare a Statement of Cash Flows.
Hints: In operating activities subtract gains and premium amortization.