kits on credit from Pool Manufacturers Inc. (PMI) for the upcoming pool installa

Question

kits on credit from Pool Manufacturers Inc. (PMI) for the upcoming pool installation season. In addition, the following events occurred: (8 marks) 6 On lanuary 1,2018 Golden Pool Supplies Inc. (GPSI) purchased $300,000 of above ground pool Jan 15, 2018-GPSI received $50,000 in deposits from customers to install above ground pools this coming 2018 spring Jan i6. 2018-GPSI paid $100.000 to PMI on account of the purchased kits on January 1, 2018. February 1, 2018- of a Note fl agreed to Payable, bearing interest at 8%, due December 31, 2018. GPSI and PMI agreed to formalize the amount owed by GPSI to PMI by way March 15, 2018 -GPSI installed an above ground pool for a customer. The customer gave a $ s000 deposit to GPSI on January Jan 15 and the total contract price for the pool install was $18 15, 2018 which is included in the total deposits received on 000. Required: GPSI has a June 30 year end. Please prepare the journal entries and adjusting entries (if any) at June 30, 2018 to reflect the above events.

Explanation / Answer

The following journal entries will be prepared:

The following adjusting entry will be prepared on June 30:

Date Description Debit Credit Jan. 1 Equipment 300000       Accounts Payable 300000 Jan. 15 Cash 50000       Unearned Revenue 50000 Jan. 16 Accounts Payable 100000       Cash 100000 Feb. 1 Accounts Payable 200000       Notes Payable 200000 Mar. 15 Cash 13000 Unearned Revenue 5000       Revenue 18000

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