My Accounting Corporation My Accounting Corporation does basic bookkeeping, payr

Question

My Accounting Corporation My Accounting Corporation does basic bookkeeping, payroll service and financial statement preparation for small to mid-sized companies. My Accounting Corporation serves a five-state area including Illinois, Indiana, lowa, Michigan and Wisconsin. The company has been in business for 20 years. In recent years, annual revenues at My Accounting Corporation have exceeded $5 million. Luciano Mastriano is the VP in charge of New Client Accounts at My Accounting Corporation He recently hired you as an intern. Luciano held a meeting with all the interns to explain what the intern responsibilities will be. At the meeting he introduced you to Maggie Kim, Manager- in-Charge for new client accounts in Ilinois Maggie gave your intern group an assignment to do the bookkeeping and limited-scope financial statement preparation for four start-up companies. All four of the companies started business January 1, 2018. This activity involves doing the work for Dog 'N Cat Corp only.] Required 1. 2. 3. Complete the Transaction Worksheet. Post all journal entries to T-accounts. Prepare a set of properly formatted journal entries for the transactions listed. 4 Complete a Transaction Analysis indicating how each transaction affected total assets, total liabilities and total equity. 5. 6. 7. Prepare a Trial Balance Prepare the January 31 Balance Sheet Prepare the Statement of Cash Flows for the Month Ending January 31.

Explanation / Answer

Dog N Cat corp JOURNAL ENTRIES Ref Account Titles Debit Credit 1 Cash $325,000 Common stock-no par value $325,000 2 Cash $467,500 Common stock-par value $1 $125,000 Additional paid in capital $342,500 (467500-125000) 4 Land $164,225 Building $421,775 (586000-164225) $421,775 Cash $117,200 (0.2*586000) 117200 Mortgage payable $468,800 (586000-117200) $468,800 5 Asset-Computers $46,000 Accounts payable $46,000 6 Assets-Office furniture $56,400 Loan Payable $56,400 7 Assets-Display fixtures $140,300 Cash $140,300 8 Supplies $128,800 Cash $128,800 9 Inventory $223,100 Accounts payable $223,100 10 Asset-display fixtures $700 Accounts payable $700 11 Accounts payable $12,500 Inventory $12,500 12 Prepaid insurance $66,000 Cash $66,000 13 Accounts payable $111,500 Inventory $4,014 (0.036*111500) 4014 Cash $107,486 (111500-4014) T-Accounts CASH Ref Account Debit Credit 1 Common stock-no par $325,000 2 common stock $125,000 2 Additional paid in $342,500 4 Land & buildings $117,200 7 Assets-Display fixtures $140,300 8 Supplies $128,800 12 Prepaid insurance $66,000 13 Accounts payable $107,486 Ending Balance $232,714 INVENTORY Ref Account Debit Credit 9 Accounts payable $223,100 11 Accounts payable $12,500 13 Accounts payable $4,014 Ending balance $206,586 SUPPLIES Ref Account Debit Credit 8 cash $128,800 PREPAID INSURANCE Ref Account Debit Credit 12 Cash $66,000 LAND Ref Account Debit Credit 4 cash $164,225 BUILDING Ref Account Debit Credit 4 Cash $421,775 ASSET-COMPUTERS Ref Account Debit Credit 5 Cash $46,000 ASSET-OFFICE FURNITURES Ref Account Debit Credit 6 Cash $56,400 ASSET-DISPLAY FIXTURES Ref Account Debit Credit 7 cash $140,300 10 Accounts payable $700 Ending Balance $141,000 ACCOUNTS PAYABLE Ref Account Debit Credit 5 Computer $46,000 9 Inventory $223,100 10 Display fixtures $700 11 Inventory $12,500 13 Inventory $111,500 Ending balance $145,800 LOANS PAYABLE Ref Account Debit Credit 6 Office furniture $56,400 MORTGAGE PAYABLE Ref Account Debit Credit 4 Building $468,800 COMMON STOK-NO PAR VALUE Ref Account Debit Credit 1 Cash $325,000 COMMON SOCK -PAR VALUE $1 Ref Account Debit Credit 2 Cash $125,000 ADDITIONAL PAID UP CAPITAL Ref Account Debit Credit 2 Cash $342,500

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