Dindorf Company: Accounting Cycle
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26. DINDORF COMPANY
THE ACCOUNT BALANCES IN THE LEDGER OF THE DINDORF COMPANY ON JANUARY 31, (THE END OF ITS FISCAL YEAR) BEFORE
ADJUSTMENTS WERE AS FOLLOWS;
DEBIT BALANCES CREDIT BALANCES
CASH AND CASH EQUIVALENTS $119,115 ACCUMULATED DEPRECIATION ON STORE EQUIPMENT $37,300
ACCOUNTS RECEIVABLE 162,500 ACCOUNTS PAYABLE 118,180
MERCHANDISE INVENTORY 700,680 NOTES PAYABLE 143,000
STORE EQUIPMENT 215,000 COMMON STOCK 300,000
SUPPLIES INVENTORY 15,475 RETAINED EARNINGS 122,375
PREPAID INSURANCE 38,250 SALES REVENUES 716,935
SELLING EXPENSE 24,900
SALES SALARIES 105,750
MISCELLANEOUS GENERAL EXPENSE 31,000
SALES DISCOUNTS 6,220
INTEREST EXPENSE 9,300
SOCIAL SECURITY TAX EXPENSE 9,600
TOTAL $1,437,790 $1,437,790
THE DATA FOR THE ADJUSTMENTS ARE:
1. THE COST OF MERCHANDISE SOLD, $302,990
2. DEPRECIATION ON STORE EQUIPMENT $12,750
3. SUPPLIES INVENTORY, JANUARY 31, $5,210 (PURCHASE OF SUPPLIES DURING THE YEAR WERE DEBITED
TO THE SUPPLIES INVENTORY ACCOUNT
4. EXPIRED INSURANCE, $4,660
5. INTEREST ACCRUED ON NOTES PAYABLE, $3,730
6. SALES SALARIES EARNED BUT NOT PAID TO EMPLOYEES, $3,575
7. INTEREST EARNED ON SAVINGS ACCOUNTS, BUT NOT RECORDED $390.
REQUIRED
1. SET UP T ACCOUNTS WITH BALANCES GIVEN ABOVE
2. JOURNALIZE AND POST ADJUSTING ENTRIES, ADDING OTHER T ACCOUNTS AS NECESSARY.
3. JOURNALIZE AND POST CLOSING ENTRIES.
4. PREPARE AN ADJUSTED TRIAL BALANCE
5. PREPARE IN GOOD FORMAT AN INCOME STATEMENT, A STATEMENT OF RETAINED EARNINGS, AND A BALANCE
SHEET ALL AS OF JANUARY 31,
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The solution explains the adjusting entries, preparation of financial statements and the closing entries for Dindorf Company
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26. DINDORF COMPANY
THE ACCOUNT BALANCES IN THE LEDGER OF THE DINDORF COMPANY ON JANUARY 31, (THE END OF ITS FISCAL YEAR) BEFORE
ADJUSTMENTS WERE AS FOLLOWS;
DEBIT BALANCES CREDIT BALANCES
CASH AND CASH EQUIVALENTS $119,115 ACCUMULATED DEPRECIATION ON STORE EQUIPMENT
ACCOUNTS RECEIVABLE 162,500 ACCOUNTS PAYABLE
MERCHANDISE INVENTORY 700,680 NOTES PAYABLE
STORE EQUIPMENT 215,000 COMMON STOCK
SUPPLIES INVENTORY 15,475 RETAINED EARNINGS
PREPAID INSURANCE 38,250 SALES REVENUES
SELLING EXPENSE 24,900
SALES SALARIES 105,750
MISCELLANEOUS GENERAL EXPENSE 31,000
SALES DISCOUNTS 6,220
INTEREST EXPENSE 9,300
SOCIAL SECURITY TAX EXPENSE 9,600
TOTAL $1,437,790
THE DATA FOR THE ADJUSTMENTS ARE:
1. THE COST OF MERCHANDISE SOLD, $302,990
2. DEPRECIATION ON STORE EQUIPMENT $12,750
3. SUPPLIES INVENTORY, JANUARY 31, $5,210 (PURCHASE OF SUPPLIES DURING THE YEAR WERE DEBITED
TO THE SUPPLIES INVENTORY ACCOUNT
4. EXPIRED INSURANCE, $4,660
5. INTEREST ACCRUED ON NOTES PAYABLE, $3,730
6. SALES SALARIES EARNED BUT NOT PAID TO EMPLOYEES, $3,575
7. INTEREST EARNED ON SAVINGS ACCOUNTS, BUT NOT RECORDED $390.
REQUIRED
1. SET UP T ACCOUNTS WITH BALANCES GIVEN ABOVE
2. JOURNALIZE AND POST ADJUSTING ENTRIES, ADDING OTHER T ACCOUNTS AS NECESSARY.
3. JOURNALIZE AND POST CLOSING ENTRIES.
4. PREPARE AN ADJUSTED TRIAL BALANCE
5. PREPARE IN GOOD FORMAT AN INCOME STATEMENT, A STATEMENT OF RETAINED EARNINGS, AND A BALANCE
SHEET ALL AS OF JANUARY 31,
1. We first seup the T- accounts. We transfer the balances given above to the T-accounts
We then pass the adjusting and closing entries. The adjusting entries are with the alphabets
and the closing entries are with numerals
Cash ...
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