There are 3 problems this week. Click on the tabs at the bottom of the spreadshe
ID: 2424693 • Letter: T
Question
There are 3 problems this week. Click on the tabs at the bottom of the spreadsheet to view each problem. Prepare the journal entries for the eight following transactions. Use dates but descriptions are not required. On 10/1/15, Equipment was purchased for dollar10, 000 each down payment and a 10% per annum promissory note of dollar40, 000. On 12/31/15, the fiscal year ended and the accrued interest was recorded as an adjusting entry. On june 30, 2016 the note was paid in full. No interest has been accrued in 2016 yet. There are 10, 000 shares of dollar2 par common stock outstanding. The board of directors delcares a 15 cent dividend per share on may 15, 2016. On june30, the above declared dividend is paid to holders of record as of june 20, 2016Explanation / Answer
10-01-2015
Equipment a/c Dr.
50000
Cash a/c Cr.
10000
Loan a/c Cr.
40000
A
B
(B-A)
31-12-2015
Interes exp a/c Dr.
3890
01-01-2015
31-12-2015
365
Accured interest a/c Cr
3890
10-01-2015
31-12-2015
355
30-06-2016
Interes exp a/c Dr.
1995
Accured interest
(((40000*10%)/365)*355)
3,890
Accured interest a/c Cr
1995
A
B
(B-A)
30-06-2016
Loan a/c Dr.
40000
01-01-2015
31-12-2015
365
Accured interest a/c Dr
5885
01-01-2016
30-06-2016
182
Bank a/c Cr
45885
Accured interest
(((40000*10%)/365)*182)
1,995
15-05-2016
Divident a/c Dr.
3000
Prposed divident Cr.
3000
Divident
(10000*2)*15%
3000
30-06-2016
Prposed divident Dr.
3000
Bank a/c Cr
3000
15-07-2016
Divident a/c Dr.
8000
Prposed divident Cr.
8000
Divident
(8000*10)*10%
8000
30-07-2016
Prposed divident Dr.
8000
Bank a/c Cr
8000
10-08-2016
Common stock a/c (15)Dr
750000
No of share if 2 for 1
50000*2
100000
Common stock a/c (7.5) Cr
750000
Par value
15/2
7.5
750000
10-01-2015
Equipment a/c Dr.
50000
Cash a/c Cr.
10000
Loan a/c Cr.
40000
A
B
(B-A)
31-12-2015
Interes exp a/c Dr.
3890
01-01-2015
31-12-2015
365
Accured interest a/c Cr
3890
10-01-2015
31-12-2015
355
30-06-2016
Interes exp a/c Dr.
1995
Accured interest
(((40000*10%)/365)*355)
3,890
Accured interest a/c Cr
1995
A
B
(B-A)
30-06-2016
Loan a/c Dr.
40000
01-01-2015
31-12-2015
365
Accured interest a/c Dr
5885
01-01-2016
30-06-2016
182
Bank a/c Cr
45885
Accured interest
(((40000*10%)/365)*182)
1,995
15-05-2016
Divident a/c Dr.
3000
Prposed divident Cr.
3000
Divident
(10000*2)*15%
3000
30-06-2016
Prposed divident Dr.
3000
Bank a/c Cr
3000
15-07-2016
Divident a/c Dr.
8000
Prposed divident Cr.
8000
Divident
(8000*10)*10%
8000
30-07-2016
Prposed divident Dr.
8000
Bank a/c Cr
8000
10-08-2016
Common stock a/c (15)Dr
750000
No of share if 2 for 1
50000*2
100000
Common stock a/c (7.5) Cr
750000
Par value
15/2
7.5
750000
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