Q1) Nordham Corporation's trial balance at December 31, 2008, is given below. All 2008 transactions have been recorded except for items describeed below and on the next page.
| |
Debit |
Credit |
| Cash |
$ 23,000 |
|
| Accounts Receivable |
51,000 |
|
| Merchandise Inventory |
22,700 |
|
| Land |
65,000 |
|
| Building |
95,000 |
|
| Equipment |
40,000 |
|
| Allowance for Doubtful Accounts |
|
$ 450 |
| Accumulated Depreciation-Building |
|
30,000 |
| Accumulated Depreciation-Equipment |
|
14,400 |
| Accounts Payable |
|
19,300 |
| Bond Interest Payable |
|
-0- |
| Dividends Payable |
|
-0- |
| Unearned Rent Revenue |
|
8,000 |
| Bonds Payable (10%) |
|
50,000 |
| Common Stock ($10 par) |
|
30,000 |
| Paid-in Capital in Excess of Par-Common Stock |
|
6,000 |
| Preferred Stock ($20 par) |
|
-0- |
| Paid-in Capital in Excess of Par-Preferred Stock |
|
-0- |
| Retained Earnings |
|
75,050 |
| Treasury Stock |
-0- |
|
| Dividends |
-0- |
|
| Sales |
|
570,000 |
| Rent Revenue |
|
-0- |
| Bad Debts Expense |
-0- |
|
| Bond Interest Expense |
2,500 |
|
| Cost of Goods Sold |
400,000 |
|
| Depreciation Expense-Buildings |
-0- |
|
| Depreciation Expense-Equipment |
-0- |
|
| Other Operating Expenses |
39,000 |
|
| Salaries Expense |
65,000 |
|
| Total |
$803,200 |
$803,200 |
Unrecorded transactions
1. On January 1, 2008, Nordham issued 1,000 shares of $20 par, 6% preferred stock for $22,000.
2. On January 1, 2008, Nordham also issued 1,000 shares of common stock for $23,000.
3. Nordham obtained 300 shares of its common stock on July 1, 2008, for $49 per share.
4. On December 31, 2008, Nordham declared annual preferred stock dividend and a $1.50 per share dividend on outstanding common stock, all payable on January 15, 2009.
5. Nordham estimates that uncollectible account receivable at year-end is $5,100.
6. Building is being depreciated using straight-line method over 30 years. Salvage value is $5,000.
7. Equipment is being depreciated using straight-line method over 10 years. Salvage value is $4,000.
8. Unearned rent was collected on October 1, 2008. It was receipt of 4 months' rent in advance (October 1, 2008 through January 31, 2009).
9. 10% bonds payable pay interest every January 1 and July 1. Interest for 6 months ended December 31, 2008, has not been paid or recorded.
problems:
a) Create journal entries for transactions given above.
b) Create an updated Dec 31st trial balance, reflecting the unrecorded transaction
c) Create a multiple-step income statement for year ending Dec 31st
d) Create a retained earnings statement for year ending dec 31
e) Create a classified Balance sheet for Dec