You are a controller at Star Wars, Inc. you must Create Journal Entries for the following transactions
Question:
You are a controller at Star Wars, Inc. you must Create Journal Entries for the following transactions
On Dec. 21 An uninhabited moon orbiting the planet of Star Wars, Inc.'s headquarters is acquired by issuing 25,000 shares of unissued common stock. The moon has a fair value of $1,200,000. The moon is immediately used for operations. The moon is considered land.
On Dec. 21 A bill from Han Solo, Esquire is received for legal services performed related to the acquisition of the moon. The total of the bill is $13,000 and is paid immediately. The legal services were required to acquire the moon.
On Dec. 24 Purchased office supplies from Naboo Stationery Co. for $5,112 in cash. Treat the supplies as an asset.
On Dec 24. Purchased 230 units of inventory from Calrisian's Components for $395 each on credit, terms net/45
On Dec 26 Sold 255 units of product to Jango Fett, Inc. for $840 each on credit.
On Dec. 26 R2D2 Computers agrees to convert a $43,900 overdue A/R balance into a 13% note due in 6 months. The original sale was from a Nov. 15 sale. Previously, R2D2 paid $52,000 of the balance off. Increase notes receivable and decrease A/R.
On Dec. 27 Paid bi-weekly wages via payroll checks. The payroll summary is below:
Employee wages (gross) $6,120 FICA taxes withheld 468 Federal income taxes withheld 1,567 State income taxes withheld 355 Net pay $3,730
Employer's payroll taxes (use payroll tax expense): FICA tax $468 (no FUTA or SUTA)
On Dec. 27 Star Wars, Inc. repurchases 3,000 shares of its own stock from an investor for $45 per share. The repurchase is recorded as Treasury Stock at its repurchase cost.
On Dec. 27 Paid $15,500 for ordinary repairs and maintenance on star ships.
On Dec. 28 Star Wars, Inc. sold a used Star Destroyer to Chewbacca and Sons Co. for $75,100 cash. The original cost of the Star Destroyer was $200,000 with a salvage value of $25,000, a useful life of 10 years, and accumulated depreciation of $100,000 through the end of last fiscal year. Note: you will need to record 1/2's years depreciation for this year before recording the sale (the company policy is to depreciate assets for 1/2 year in the year of acquisition and disposal). Star Wars, Inc. uses the straight-line method to depreciate Star Destroyers.
Note: record depreciation expense first, then the disposal. Record 1/2 year depreciation in these first 2 cells.
On Dec. 28 Paid the A/P balance to Tattoine Inc from the 12/19 purchase. No discount applies.
On Dec. 28 The Board of Directors of Star Wars Inc. declares a $3.25 per share cash dividend to be paid in January of the next year. You will need to determine the number of shares outstanding. See instructions for the beginning amount and don't forget to take into account previous transactions involving new shares issued and repurchased shares. Take the amount directly out of retained earnings.
On Dec. 28 Paid bill for advertisements run on Dec. 15th. The bill was for $18,150.
On Dec. 28 Received payment from Vader Enterprises from the Dec. 13 sale. No discount applies.
On Dec. 30 Purchased 315 units of product from Hyperspace Unlimited for $387 per unit on credit, terms n/30.
On Dec 31 Paid monthly salaries via payroll checks. The payroll summary is below:
Employee salaries (gross) $63,300 FICA taxes withheld 4,842 Federal income taxes withheld 9,154 State income taxes withheld 2,317 Net pay $46,987 Employer's payroll taxes: FICA tax $4,842 (no FUTA or SUTA)
On Dec. 31 Sold 310 units to Vader Enterprises for $850 each on credit.
On Dec 31. The petty cash custodian performs the month-end reconciliation and totals the receipts as follows: Postage stamps used $58 Courier costs $73 Company lunch costs $61 Office decorations $30
$68 of cash remained on hand. Record the entry to reimburse the petty cash fund. Book any overage or shortage to Petty Cash Overage/Shortage. Use Misc. expense for all costs noted above.
On Dec. 31 Deposited $40,000 in a bond sinking fund (related to paying back bonds payable). Use the Other assets account for the debit.