Assume that MoviesDoorToDoor.com began on January 1, 2017. All transactions refl

Question

Assume that MoviesDoorToDoor.com began on January 1, 2017. All transactions reflected in Parts A and B occur during the first quarter of operations.

Part A (Pictures 1 and 2)

Record the journal entries for each transaction.

Record each transaction in T-accounts.

Part B (Picture 3)

Record the adjusting journal entries for each transaction

Record each transaction in the T-accounts started in Part A

Prepare an adjusting balance sheet, income statement and statement of retained earnings of March 31, 2017 (and for the quarter then ended)

GB 212 Transaction Analysis for MaviesDoor tolheer.com Part A Assume that MoviesDoorToDoor.coem began om Jamuary 1. 2017, All transactios reflectol in Parts A and B occur during the first quarter of operations Required: a) record the journal entries for cach transaction b) record each transaction in T-accounts A. This will You do not need to do an unadjusted set of final statements for Part be done after the adjusting joumal entries in Part B 1. Courtney, Brad, John, and John's mother contribubed a total of $60,000 cash is exchange for ownership interest in their new company (Afovles). The company, which rents movie videos and DVDs, will be organized On February 1,2017, the company received $18,000 from Courtney's parents as a loan. The company must repay this money at the end of 5 years. Each year Movles must pay Courtney's parents interest on the loan at an annual rate of 8% Courtney, Brad and John spent a significant amount of cash on various assets that were needed hy the business. In total, $23,000 was spent to acquire computer equipment (S20,000) and office supplies ($3,000). 3. r, more assets were purchased. These included As the opening date came closer inventories of tapes and DVDs ($12,000), additional computer equipment (56,000) and office equipment such as cash registers, shelving and display cases ($4,000). All of these purchases were made on account. 4. 5. Another shipment of tapes and DVDs was purchased for $5,000 from another vendor. Movies paid $2,000 in cash for this purchase and put the rest on account. One laptop computer purchased in transaction #3 for $2.000 was found to be unsuitable for the needs of the business. The company sold that computer to an acquaintance of John's for $2,000. 6. 7. Movies paid 310,000 of its accounts payable.

Explanation / Answer

A)

(a)    Journal Entries

(b) T- Accounts

Particulars Dr.($) Cr. ($) Cash 60000 Owners Equity 60000 Cash 18000 Loans Payable 18000 Computer Equipment 20000 Office Supplies 3000 Cash 23000 Inventory 12000 Addl. Computer Equipment 6000 Addl. Office Equipment 4000 Cash 22000 inventory 5000 cash 2000 Accounts payable 3000 cash 2000 Computer Equipment 2000 Accounts payable 10000 Cash 10000 Advanced Rent 18000 Insurance 4000 Cash 22000 Cash 21000 Rental Income 21000 Salary 2300 Cash 2300 Utilities Exp. 6000 Cash 6000 Cash 400 Inventories 300 Sales Income 100 Cash 720 Sales Income 720

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