Homework answers / question archive / 1) (6 marks) George’s Manufacturing Corporation accepted a 6-month note from a customer on September 30, 2019, 150,000 at 8% interest for a sale

1) (6 marks) George’s Manufacturing Corporation accepted a 6-month note from a customer on September 30, 2019, 150,000 at 8% interest for a sale

Accounting

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1) (6 marks) George’s Manufacturing Corporation accepted a 6-month note from a customer on September 30, 2019, 150,000 at 8% interest for a sale. Prepare all related journal entries related to the note. The year-end for George’s Manufacturing Corporation is December 31. Ensure that you use standard journal entry form to attain full marks. Round to two decimal places. Use days for all interest calculations.

2) (16 marks) Inventory data for Freezer Burn Corporation for the year ended December 31, 2020, are as follows:

Beginning inventory             50 units at $150 each

March 31 purchase              50 units at $155 each

April 22 sale                       60 units                     Sold at $200 each      

June 30 purchase                 55 units at $160 each

July 17 sale                        70 units                     Sold at $200 each

September 30 purchase        60 units at $170 each

October 20 purchase            40 units at $174 each

November 18 sale                54 units                     Sold at $200 each

Compute the ending inventory balance and calculate cost of goods sold on December 31, 2020, under the perpetual system, using:

a. FIFO

b. Moving Weighted-average (round unit averages to dollars and cents).

3. (12 marks) Seattle Coffee Limited's bank statement for the month of November 30, 2020 showed a balance per bank of $7,000. The company's general ledger Cash account showed a balance of $5,904 at November 30, 2020. Other information is as follows:

1. Cash receipts for November 30 recorded on the company's books were $5,200, but this amount does not appear on the bank statement.

2. The bank statement shows a Bank charge fee for $40 for cheque printing charges.

3. Cheque #119 payable in the amount of $248 to Holt Corporation was recorded in the general journal for $284 and cleared the bank for $248. The correct amount of Cheque #119 is $248. The bookkeeper made an error.

4. The total amount of cheques outstanding at November 30 was $5,800.

5. The bank statement shows and EFT for Utilities of $200.

6. The bank returned an NSF cheque from a customer for $560.

7. The bank statement included a deposit for $1,260, which represents the electronic collection of customer accounts which have not yet been recorded on the company’s books.

Instructions

(a) Prepare a bank reconciliation for Seattle Coffee Limited at November 30, 2020. (hint: use the template on Moodle to ensure correct formatting)

(b) Prepare any journal entries necessary as a result of the bank reconciliation.

4) (6 marks) Prepare the necessary journal entries to record the following transaction in 2020 for Shula Company. Ensure you use standard journal entry form to attain full marks.

2020

July 31 – Shalua Company sold a delivery truck for $25,000 cash. The delivery truck originally costed $57,000 and the accumulated depreciation account was $19,000 on the date of the sale. Assume depreciation on the truck is only recorded every December 31. Depreciation is calculated on a declining-balance basis using a rate of 30%.