Put a copy of all your journal entries for 2019 here on this tab.

You are not making ANY prior year entries. Any prior year information is just that--information.????

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JKL, Inc. Trial balances Cash Investment in trading securities Accounts receivable Allowance for doubtful accounts Interest receivable Inventory Current portion of notes receivable Prepaid expenses Allowance for change in fair value of securities Term portion of note receivable Investment in DFE Corp. Machine A Machine B Building Other depreciable assets Machine D Outdoor rigging Electronic Equipment E (related to outdoor rigging venture) Accumulated depreciation Patent Goodwill -- DFE Corp. Accounts payable Taxes payable Accrued expenses Preferred dividends payable Pension liability Bonds payable, 6%, due 2034 suspense Preferred non-cumulative, 6%, $500 par, 3616 shares outstandin Final Adj. 12/31/2018 580,000 64,000 138,000 (2,000) 60,000 4,000 72,000 68,000 676,000 992,000 92,000 288,000 92,000 (1,300,000) 128,000 (1,020,000) (36,000) (4,000) (360,000) (1,808,000) Unadjusted 12/31/2019 Ref 724,000 64,000 30,000 (2,000) 44,000 4,000 72,000 68,000 676,000 992,000 92,000 288,000 92,000 (1,300,000) 128,000 (180,000) (36,000) (32,000) (360,000) 1,084,000 (1,808,000) DR Ref CR Adjusted 12/31/2019 Common stock, $10 par, 9,000 shares outstanding Paid in capital in excess of par, common Accumulated other comprehensive income Treasury stock Retained earnings Sales Cost of goods sold Selling, general and administrative expense Interest income Interest expense Depreciation expense Federal income tax expense Tax expense or benefit re: discontnued sale Tax expense or benefit re: discontnued operation Results from discontinued operations--disposition Results from discontinued operations--operation Extraordinary gains or losses (360,000) (272,000) 1,908,000 Balances at 12/31/18 are needed for the cash flow worksheet. Balances at 12/31/19 are the ending balances for 2019 before your adjustments. Get your trial balance worksheet 2018 beginning balances from the 2018 column above. You can add accounts as needed. (360,000) (272,000) 1,908,000 (5,420,000) 3,160,000 344,000 JKL, Inc. presents the preliminary trial balance at 12/31/19 and the related information set out below. Entries for the related information have not been recorded, but routine transactions for operation of the company during the year have been recorded. Accordingly, you have an unadjusted trial balance at 12/31/19. The trial balance for 12/31/18, also called the prior year trial balance, is a post-closing trial balance. The following information, for which no adjustment has been made, is available: The unadjusted 2019 trial balance is in an Excel file, together with the prior year trial balance. JKL, Inc. s book tax rates are 21%. Unusual Event Early in January, this year, an unusual event occurred when a big wind caused a boom to collapse, destroying $310,000 of outdoor rigging and electronic gear (asset E) that had just been installed. While this kind of accident has occurred before, it has not happened often. The outdoor rigging and electronic gear were of a new business venture the company began early last year. The destroyed electronic equipment can be sold for scrap in the open market at 15% of cost. The outdoor rigging, bought early last year (depreciation: straight line, no salvage, 5 year life) can be sold on the used equipment market for book value. Management is disheartened, and is abandoning this component of the business. Had the venture continued, it would have had spearate cash flows and operations. The company estimates that 50% of the overall SG&A for the January was directly related to the outdoor rigging and that the SG&A costs for the year are incurred at a smooth rate all year long. Trading Securities The company invests in trading securities. Year end market prices were: The company held 4,000 shares of X, 2,000 shares of Y and 1,500 shares of Z at 12/31/19. The company owns 1,000 shares of HAL Corp., which are also trading securities (used to be held for sale). the end of 2019, HAL was priced at $29 per share. Security Price per shar Shares Extension Total Security X 4 4,000 16,000 Security Y 7 2,000 14,000 Security Z 1,500 24,000 HAL 1,000 29,000 83,000 16 29 Possible Impairment JKL, Inc. owns DFE Co., which they bought for $465,000 several years ago. It is fully consolidated and the correct consolidation entries have already been recorded in the JKL, Inc. trial balance. Due to changing technology, JKL, Inc. determined to examine the investment to see if it was impaired. The identifiable assets originally appraised at $329,000. The new appraisal at December 31, 2019, puts the total fair value for DEF at $388,000, with identifiable assets at $310,000. Reclass needed JKL, Inc. has an amount of $1,084,000 in a suspense account on its trial balance. The details of this amount are as follows (if you end up with a $1,000 rounding error, put the difference to lawsuit defense: PP&E On June 30, 2019, JKL, Inc. sold plant equipment (asset D) for $78,000. The equipment was purchased January 1, 2016 for 97,000. JKL, Inc. used the 200% declining balance method for this asset, over an estimated useful life of 7 years, with salvage value set at $12,000. Payment received included $10,000 cash and the buyer s note for the balance. The note requires equal annual principal payments over 5 years from date, together with interest at 8%. Additionally, depreciation expense for 2019 of $107,000, related to other depreciable assets of $1,066,000 is appropriate and has not been recorded. Other than any assets discussed above, the company has plant and equipment with cost, acquisition dates, etc., as shown: All are depreciated by the straight line method. 2019 depreciation has not been recorded. On 01-01-19, the company changed its estimate for the life of Machine B to 10 years from 7 years. Bad Debts The company feels that bad debt expense needs to be recorded. They will use the balance sheet/aging of A/R method. The calculated ending balance for the allowance account is $2,500. Legal & administrative cost of obtaining patent Cost of development of product patented Cost of defense of 2019 law suit challenging the p Acquired 1/1/2016 Machine A 1/1/2017 Machine B 1/1/2010 Building Life 5 years 7 years 35 years Cost 194,000 581,000 309,000 Salvage 78,000 7,000 None 727,000 None 10% Capitalization: a. JKL, Inc. began 2019 with 38,800 shares of $10 par common stock that were initially issued for $17.50 per share. These shares have been recorded. b. There is one issue of non-cumulative 6% $500 par preferred stock. There are 3,616 shares issued and outstanding and the dividend was declared during 2019, payable January 15 2020, to holders of record December 31, 2019. These shares (but not the dividend associated with the shares) have already been recorded. c. On May 1, 2019, the company sold an additional 750 bonds with warrants attached. The bonds, which mature in 2034, had a face value of $1,000 each, with 6% annual rate interest coupon interest due June 1 and December 1. Each bond carries 5 warrants to buy one share of the common stock of the company at $35.00 per share one warrant +$35 buys one share.) The bonds were sold to a private investor at 103 (priced to yield 8%), plus accrued interest. By comparison to other similar securities, the company has determined that the day after the sale the fair value of the bonds without the warrants was 98, and that the warrants would be expected to trade at $6.00. On December 31, 2019, 750 warrants (with the appropriate amount of cash) were tendered to the company in exchange for common stock. The average price of the common stock during 2019 was $20 per share. d. On September 1, 2019, the company purchased 5,000 shares of its common stock for $23.50 per share. Performance & incentive compensation. a. JKL, Inc. has adopted performance based compensation for the President and for the Executive Vice President for Operations. The president receives 2% of the after-tax, after-bonus profit, and the EVPO receives 1.5%. The bonuses for 2018 were appropriately accrued at year end 2018, and were paid January 15, 2019 (accruals were reversed.) b. The company adopted a stock based incentive compensation plan, effective January 01, 2019. Under the plan, the President/CEO was granted 30,000 share options on JKL, Inc. s common stock. The EVP Operations and the CFO each received 20,000 share options. The options strike price is $30 per share. The company uses the US Treasury yield on the 10-year Treasury Bill as an approximation of the risk free rate. The intrinsic value of the stock options are $7.92. These options vest ratably per year over a two year period. JKL, Inc. Trial balances Cash Investment in trading securities Accounts receivable Allowance for doubtful accounts Interest receivable Inventory Current portion of notes receivable Prepaid expenses Allowance for change in fair value of securities Term portion of note receivable Investment in DFE Corp. Machine A Machine B Building Other depreciable assets Machine D Outdoor rigging Electronic Equipment E (related to outdoor rigging venture) Accumulated depreciation Patent Goodwill -- DFE Corp. Accounts payable Taxes payable Accrued expenses Preferred dividends payable Pension liability Bonds payable, 6%, due 2034 suspense Preferred non-cumulative, 6%, $500 par, 3616 shares outstandin Final Adj. 12/31/2018 580,000 64,000 138,000 (2,000) 60,000 4,000 72,000 68,000 676,000 992,000 92,000 288,000 92,000 (1,300,000) 128,000 (1,020,000) (36,000) (4,000) (360,000) (1,808,000) Unadjusted 12/31/2019 Ref 724,000 64,000 30,000 (2,000) 44,000 4,000 72,000 68,000 676,000 992,000 92,000 288,000 92,000 (1,300,000) 128,000 (180,000) (36,000) (32,000) (360,000) 1,084,000 (1,808,000) DR Ref CR Adjusted 12/31/2019 Common stock, $10 par, 9,000 shares outstanding Paid in capital in excess of par, common Accumulated other comprehensive income Treasury stock Retained earnings Sales Cost of goods sold Selling, general and administrative expense Interest income Interest expense Depreciation expense Federal income tax expense Tax expense or benefit re: discontnued sale Tax expense or benefit re: discontnued operation Results from discontinued operations--disposition Results from discontinued operations--operation Extraordinary gains or losses (360,000) (272,000) 1,908,000 Balances at 12/31/18 are needed for the cash flow worksheet. Balances at 12/31/19 are the ending balances for 2019 before your adjustments. Get your trial balance worksheet 2018 beginning balances from the 2018 column above. You can add accounts as needed. (360,000) (272,000) 1,908,000 (5,420,000) 3,160,000 344,000 JKL, Inc. presents the preliminary trial balance at 12/31/19 and the related information set out below. Entries for the related information have not been recorded, but routine transactions for operation of the company during the year have been recorded. Accordingly, you have an unadjusted trial balance at 12/31/19. The trial balance for 12/31/18, also called the prior year trial balance, is a post-closing trial balance. The following information, for which no adjustment has been made, is available: The unadjusted 2019 trial balance is in an Excel file, together with the prior year trial balance. JKL, Inc. s book tax rates are 21%. Unusual Event Early in January, this year, an unusual event occurred when a big wind caused a boom to collapse, destroying $310,000 of outdoor rigging and electronic gear (asset E) that had just been installed. While this kind of accident has occurred before, it has not happened often. The outdoor rigging and electronic gear were of a new business venture the company began early last year. The destroyed electronic equipment can be sold for scrap in the open market at 15% of cost. The outdoor rigging, bought early last year (depreciation: straight line, no salvage, 5 year life) can be sold on the used equipment market for book value. Management is disheartened, and is abandoning this component of the business. Had the venture continued, it would have had spearate cash flows and operations. The company estimates that 50% of the overall SG&A for the January was directly related to the outdoor rigging and that the SG&A costs for the year are incurred at a smooth rate all year long. Trading Securities The company invests in trading securities. Year end market prices were: The company held 4,000 shares of X, 2,000 shares of Y and 1,500 shares of Z at 12/31/19. The company owns 1,000 shares of HAL Corp., which are also trading securities (used to be held for sale). the end of 2019, HAL was priced at $29 per share. Security Price per shar Shares Extension Total Security X 4 4,000 16,000 Security Y 7 2,000 14,000 Security Z 1,500 24,000 HAL 1,000 29,000 83,000 16 29 Possible Impairment JKL, Inc. owns DFE Co., which they bought for $465,000 several years ago. It is fully consolidated and the correct consolidation entries have already been recorded in the JKL, Inc. trial balance. Due to changing technology, JKL, Inc. determined to examine the investment to see if it was impaired. The identifiable assets originally appraised at $329,000. The new appraisal at December 31, 2019, puts the total fair value for DEF at $388,000, with identifiable assets at $310,000. Reclass needed JKL, Inc. has an amount of $1,084,000 in a suspense account on its trial balance. The details of this amount are as follows (if you end up with a $1,000 rounding error, put the difference to lawsuit defense: PP&E On June 30, 2019, JKL, Inc. sold plant equipment (asset D) for $78,000. The equipment was purchased January 1, 2016 for 97,000. JKL, Inc. used the 200% declining balance method for this asset, over an estimated useful life of 7 years, with salvage value set at $12,000. Payment received included $10,000 cash and the buyer s note for the balance. The note requires equal annual principal payments over 5 years from date, together with interest at 8%. Additionally, depreciation expense for 2019 of $107,000, related to other depreciable assets of $1,066,000 is appropriate and has not been recorded. Other than any assets discussed above, the company has plant and equipment with cost, acquisition dates, etc., as shown: All are depreciated by the straight line method. 2019 depreciation has not been recorded. On 01-01-19, the company changed its estimate for the life of Machine B to 10 years from 7 years. Bad Debts The company feels that bad debt expense needs to be recorded. They will use the balance sheet/aging of A/R method. The calculated ending balance for the allowance account is $2,500. Legal & administrative cost of obtaining patent Cost of development of product patented Cost of defense of 2019 law suit challenging the p Acquired 1/1/2016 Machine A 1/1/2017 Machine B 1/1/2010 Building Life 5 years 7 years 35 years Cost 194,000 581,000 309,000 Salvage 78,000 7,000 None 727,000 None 10% Capitalization: a. JKL, Inc. began 2019 with 38,800 shares of $10 par common stock that were initially issued for $17.50 per share. These shares have been recorded. b. There is one issue of non-cumulative 6% $500 par preferred stock. There are 3,616 shares issued and outstanding and the dividend was declared during 2019, payable January 15 2020, to holders of record December 31, 2019. These shares (but not the dividend associated with the shares) have already been recorded. c. On May 1, 2019, the company sold an additional 750 bonds with warrants attached. The bonds, which mature in 2034, had a face value of $1,000 each, with 6% annual rate interest coupon interest due June 1 and December 1. Each bond carries 5 warrants to buy one share of the common stock of the company at $35.00 per share one warrant +$35 buys one share.) The bonds were sold to a private investor at 103 (priced to yield 8%), plus accrued interest. By comparison to other similar securities, the company has determined that the day after the sale the fair value of the bonds without the warrants was 98, and that the warrants would be expected to trade at $6.00. On December 31, 2019, 750 warrants (with the appropriate amount of cash) were tendered to the company in exchange for common stock. The average price of the common stock during 2019 was $20 per share. d. On September 1, 2019, the company purchased 5,000 shares of its common stock for $23.50 per share. Performance & incentive compensation. a. JKL, Inc. has adopted performance based compensation for the President and for the Executive Vice President for Operations. The president receives 2% of the after-tax, after-bonus profit, and the EVPO receives 1.5%. The bonuses for 2018 were appropriately accrued at year end 2018, and were paid January 15, 2019 (accruals were reversed.) b. The company adopted a stock based incentive compensation plan, effective January 01, 2019. Under the plan, the President/CEO was granted 30,000 share options on JKL, Inc. s common stock. The EVP Operations and the CFO each received 20,000 share options. The options strike price is $30 per share. The company uses the US Treasury yield on the 10-year Treasury Bill as an approximation of the risk free rate. The intrinsic value of the stock options are $7.92. These options vest ratably per year over a two year period.

Answer rating: 100% (QA)

Journal entries 1 Sale of equipment Date Account Title LF Debit Credit 30Jun ... View the full answer