Please prepare the set of financial statements and trial balance. The owners als
ID: 2575522 • Letter: P
Question
Please prepare the set of financial statements and trial balance.
The owners also have expressed to you that they need to know their inventory and cost of goods sold to manage purchases and pricing. So, you are highly considering using a perpetual inventory system. You have a trial balance and must add the additional transactions and activities identified below. You can add accounts to the trial balance, as needed. Cherry & White Bikes had the following additional transactions The owners hire Lisa Marton to manage the store, paying her a salary of $2,800 a month. Lisa is paid on the 1st of every month, starting on July 1. June 1: July 1: Installed new light fixtures and display cases in the leased store. CWB paid $2,100 for the fixtures, $250 for shipping to the store, and $700 to an electrician to install. The landlord gave CWB permission to remove and dispose of the old fixtures. CWB sold the old fixtures for $190. CWB anticipates being in the store for at least 3 years. CWB cannot take the light fixtures with them if they relocate as they will revert to the lessor. CWB can take the display cases, which cost $7,600, if they move Both the display cases and light-fixtures have a five-year useful life August 1: CWB invests $4,000 in an 18-month certificate of deposit paying interest of 1%. November 1: CWB invests in a $2,000 3-month treasury bill paying interest of 0.5% December 12: One of the standard bikes sold was returned by the customer. The bike sold for $220. CWB paid $90 for it. CWB provided a full refund. CWB's policy is to provide a customer with a full refund within 30 da¥ of purchase as long as the bike is returned in good condition December 19: A customer puts down a deposit of $300 on a high-end racing bike that sells for $2,900. CWB ordered the bike from the manufacturer. The manufacturer promises CWB will have the bike at the store on January 3 December 30: Declared and paid dividends of $600 Here is other information on activity that occurred during the period. CWB offers bike tune-ups for $85 each. CWB's employees are experts in adjusting brakes Below is the number of tune-ups performed in each month. All customers pay in cash. (For recording the transacaitons, you can assume all tune-ups are done the last day of the month) Number of Tune-Ups Month ril May June August September October December 32 23 4Explanation / Answer
Dear Student the following is the genearl ledger DATE ACCOUNT TITLES DEBIT CREDIT 15-Mar PURCHASE 1680 TO CREDITORS 1680 25-Mar PURCHASE 1085 TO CREDITORS 1085 30-Apr CASH 1530 TO BIKE TUEN UPS 1530 12-Apr CASH 5350 TO SALES 5350 13-Apr PURCHASE 2240 TO CREDITORS 2240 01-May CASH 8100 TO SALES 8100 31-May CASH 2720 TO BIKE TUEN UPS 2720 01-Jun SALARY 2800 TO CASH 2800 15-Jun CREDITORS 1680 TO CASH 1680 25-Jun CREDITORS 2635 TO CASH 30-Jun CASH 1955 TO BIKE TUEN UPS 1955 13-Jul CREDITORS 2240 TO CASH 2240 01-Jul SALARY 2800 TO CASH 2800 01-Jul LIGHT FIXTURES 1160 DISPLAY CASES 7600 TO CASH 8760 01-Aug SALARY 2800 TO CASH 2800 01-Aug DEPOSIT 4000 TO CASH 4000 20-Aug PURCHASE 1620 TO CREDITORS 1620 31-Aug CASH 1190 TO BIKE TUEN UPS 1190 01-Sep SALARY 2800 TO CASH 2800 02-Sep PURCHASE 2340 TO CREDITORS 2340 30-Sep CASH 1530 TO BIKE TUEN UPS 1530 01-Oct SALARY 2800 TO CASH 2800 16-Oct CASH 9350 TO SALES 9350 21-Oct PURCHASE 2940 TO CASH 2940 31-Oct CASH 255 TO BIKE TUEN UPS 255 01-Aug DEPOSIT 2000 TO CASH 2000 01-Nov SALARY 2800 TO CASH 2800 01-Nov CASH 4950 TO SALES 4950 20-Nov CREDITORS 1620 TO CASH 1620 01-Dec SALARY 2800 TO CASH 2800 02-Dec CREDITORS 2340 TO CASH 2340 15-Dec CASH 7840 TO SALES 7840 12-Dec SALES RETURNS 220 TO CASH 220 19-Dec CASH 300 TO ADVANCE FROM CUSTOMER 300 31-Dec CASH 340 TO BIKE TUEN UPS 340 30-Dec DIVIDEND 600 TO CASH 600 31-Dec SALARY 2800 TO SALARY PAYABLE 2800 31-Dec DEPRECIATION 2092 TO NEW LIGHT FIXTURES 610 TO DISPLAY CASES 1520 31-Dec CASH 190 TO SALE OF EQUIPMENT 190 31-Dec CASH 220 TO INTEREST ON DEPOSIT 200 TO INTEREST ON TREASURY BILL 20 CHERRY & WHITE BIKE COMPANY STATEMENT OF INCOME FOR THE PERIOD ENDED 31-12-2017 PARTICULARS AMOUNT ($) SALES 47826 SALES OF RACING BIKES 35370 BIKES TUNE UPS 9520 COST OF GOODS SOLD 15300 COGS OF RACING BIKES 11905 GROSS PROFIT 65511 Add: OTHER INTEREST INCOME 230 LESS: EXPENSES SALARIES 6800 SALARIES TO LISA 19600 UTILITIES EXPENSES 2600 RENT EXPENSES 3225 INSURANCE EXP 800 STORE SUPPLIES EXP 466 ADVERTISING EXP 1000 INTEREST EXP 1500 DEPRECIATION 2092 DIVIDEND PAID 600 PROFIT BEFORE TAX 27058 LESS: TAX @30% 8117.4 PROFIT AFTER TAX 18940.6 CHERRY & WHITE BIKE COMPANY BALANCE SHEET AS OF DEC'31,2017 ASSETS $ CASH 30106 STORE SUPPLIERS 460 PREPAID RENT' 7600 PREPAID INSURANCE 1560 DEPOSITS 6000 INVENTORY - STANDARD BIKES 2535 INVENTORY - RACING BIKES 2610 INVENTORY - CHILDREN BIKES 1243 INVENTORY - BIKE SUPPLIES EQUIPMENT 26635 NEW LIGHT FIXTURES 610 DISPLAY CASES 6080 TOTAL ASSETS 85439 LIABILITIE AND EQUITY ACCOUNT PAYABLE 8724 UTILITIES PAYABLE 875 SALARIES PAYABLE 2300 INTEREST PAYABLE 2300 LOANS PAYABLE 1500 SALARIES PAYABLE 2800 CAPITAL STOCK 2000 RETAIN EARNINGS 18940.6 INCOME TAX PAYABLE 8117.4 DIFF 37882 TOTAL LIABILITIES 47557
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