Valet Cleaners Event 4/01 issue stock 02 sign lease 03 buy equipment 04 buy supplies 05...

  

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Valet Cleaners Event 4/01 issue stock 02 sign lease 03 buy equipment 04 buy supplies 05 collect fm customers SCF Account Class Cash Recevbl 06 pay on account 07 bill customers 08 receive deposit 29 pay lease 30a depreciate equipment 30b adjust supplies 30c pay interest 30d estimate taxes 30e complete service 30f borrow via note 30g pay dividend 30h Owner sells stock End TOTALS TA Name or Discussion # Sup- Equip- Accum Account Tax plies ment Deprn Payab'l Pay'bl Note Comon Retain'd Inc/RE Pay'bl Stock Earnings Class Valet Cleaners, Inc., was formed by bachelor's degree students from Bear University on April 1, 2021. Those students had little accounting experience. They need your help. 1) On the spreadsheet, record the events below, where appropriate. If an event is not to be recorded, notate "No Entry". Three columns have no title. Fill-in titles where needed. 2) Complete your records with financial statements: income, retained earnings, cash flow, and financial position (aka balance sheet) in classified form. Apr. 1 Valet Cleaners, Inc., issued 10 shares of common stock and received $25. 2 3 Valet signed a one-year lease at $5 per month, payable at the end of each month. Valet purchased equipment priced at $50, paying $20 cash and financing the balance on a note payable in 5 years; interest accrues at 40% per year, but is paid monthly. 4 Purchased $12 of cleaning supplies on an account requiring monthly payments. Collected $4 for cleaning services provided to walk-in customers. 5 6 Paid $3 of the account owed on cleaning supplies purchased on April 4. 7 8 Mailed bills to commercial customers for $30 of regular cleaning services on account. Received a $7 deposit by commercial clients for "special" services to be rendered. Paid $5 on the property lease signed April 2. 29 30a Recorded $2 of depreciation on cleaning equipment for April. 30b Counted $3 of cleaning supplies which remained on hand at the end of April. 30c Received a lender's statement that the note for equipment is due in 59 months; In response to the statement, paid interest which is due monthly. 30d One owner reminded cohorts that Valet should avoid tax problems with the IRS. A reasonable estimate is that Valet owed $12 of taxes in April, but no taxes will be paid until March 15, 2022, i.e., corporate tax filing. 30e Valet completed $6 of "special" services (waterproofing uniforms) for commercial clients and reduced their accounts. 30f One owner noted Valet's low cash balance, and borrowed $8 via a note signed on behalf of Valet. The note is payable May 1, 2027. 30g 30h One undergraduate owner enjoyed the 40% dividend yield ($1/$2.50), but feared that the cleaning business might not be successful. She sold her 2 shares of Valet to a non- finance student for $6, making an additional 20% gain for the month. Owners now observed that Valet had cash sufficient for a dividend, declared and paid a total dividend of $10. Valet Cleaners Event 4/01 issue stock 02 sign lease 03 buy equipment 04 buy supplies 05 collect fm customers SCF Account Class Cash Recevbl 06 pay on account 07 bill customers 08 receive deposit 29 pay lease 30a depreciate equipment 30b adjust supplies 30c pay interest 30d estimate taxes 30e complete service 30f borrow via note 30g pay dividend 30h Owner sells stock End TOTALS TA Name or Discussion # Sup- Equip- Accum Account Tax plies ment Deprn Payab'l Pay'bl Note Comon Retain'd Inc/RE Pay'bl Stock Earnings Class Valet Cleaners, Inc., was formed by bachelor's degree students from Bear University on April 1, 2021. Those students had little accounting experience. They need your help. 1) On the spreadsheet, record the events below, where appropriate. If an event is not to be recorded, notate "No Entry". Three columns have no title. Fill-in titles where needed. 2) Complete your records with financial statements: income, retained earnings, cash flow, and financial position (aka balance sheet) in classified form. Apr. 1 Valet Cleaners, Inc., issued 10 shares of common stock and received $25. 2 3 Valet signed a one-year lease at $5 per month, payable at the end of each month. Valet purchased equipment priced at $50, paying $20 cash and financing the balance on a note payable in 5 years; interest accrues at 40% per year, but is paid monthly. 4 Purchased $12 of cleaning supplies on an account requiring monthly payments. Collected $4 for cleaning services provided to walk-in customers. 5 6 Paid $3 of the account owed on cleaning supplies purchased on April 4. 7 8 Mailed bills to commercial customers for $30 of regular cleaning services on account. Received a $7 deposit by commercial clients for "special" services to be rendered. Paid $5 on the property lease signed April 2. 29 30a Recorded $2 of depreciation on cleaning equipment for April. 30b Counted $3 of cleaning supplies which remained on hand at the end of April. 30c Received a lender's statement that the note for equipment is due in 59 months; In response to the statement, paid interest which is due monthly. 30d One owner reminded cohorts that Valet should avoid tax problems with the IRS. A reasonable estimate is that Valet owed $12 of taxes in April, but no taxes will be paid until March 15, 2022, i.e., corporate tax filing. 30e Valet completed $6 of "special" services (waterproofing uniforms) for commercial clients and reduced their accounts. 30f One owner noted Valet's low cash balance, and borrowed $8 via a note signed on behalf of Valet. The note is payable May 1, 2027. 30g 30h One undergraduate owner enjoyed the 40% dividend yield ($1/$2.50), but feared that the cleaning business might not be successful. She sold her 2 shares of Valet to a non- finance student for $6, making an additional 20% gain for the month. Owners now observed that Valet had cash sufficient for a dividend, declared and paid a total dividend of $10.

Answer rating: 100% (QA)

Supplies Used Supplies Available Supplies balance at the end of the period Accounting Equation ... View the full answer