One Product Corp (OPC) Incorporated at the beginning of last year. The balances

Question

One Product Corp (OPC) Incorporated at the beginning of last year. The balances on its postclosing trial balance prepared on December 31, at the end of Its first year of operations, were: $19,500 8,250 885 12.060 1,600 25,000 2.400 Cash Accounts Recelvable Allowance for Doubtful Accounts Inventory Prepaid Rent Equipment Accumulated Depreciation Accounts Payable Sales Tax Payable FICA Payable Withheld Income Taxes Payable Salaries and Wages Payable Unemployment Tax Payable Unearned Revenue Interest Payable Note Payable (ong-term) Common Stock Additional Pald-In Capltal, Common Retained Earnings Treasury Stock 500 600 500 1,600 300 4,500 495 22,000 13,300 19,210 4120 4,000

Explanation / Answer

To record remittance of payroll withholdings and employer contributions Date Account title Debit Credit Jan.03 FICA payable 600 Withheld income taxes payable 500 Unemployment taxes payable 300 Cash 1400 To record declaration of cash dividend @$0.50 per share Date Account title Debit Credit Jan.03 Retained earnings 3075 Dividend payable 3075 Common stock shares outstanding Common stock value 13300 Par value $2.00 Number of shares issued 6650 Less: Treasury stock shares 500 Number of shares outstanding 6150 Dividend per share $0.50 Dividend declared 3075 To record write off of uncollectible customer account Date Account title Debit Credit Jan.05 Allowance for doubtful accounts 950 Accounts receivable 950 To record sale of 175 units of inventory @$150 per unit plus sales tax at 6%. Cost of goods sold @$67 per unit. ($12,060 / 180) Date Account title Debit Credit Jan.06 Accounts receivable 27825 Sales revenue 26250 Sales tax payable 1575 Cost of goods sold 11725 Inventory 11725 To record remittance of sales tax payable as on December 31. Date Account title Debit Credit Jan.07 Sales tax payable 500 Cash 500 To record issue of 300 shares of treasury stock for $2,400. Date Account title Debit Credit Jan.08 Cash 2400 Treasury stock 2400 To record collections from customers on account of $8,500. Date Account title Debit Credit Jan.09 Cash 8500 Accounts receivable 8500 To record distribution of cash dividend decleared on January 3. Date Account title Debit Credit Jan.10 Divicend payable 3075 Cash 3075 To record purchase of 70 units of inventory for @4,410 on account @$63 per unit. Date Account title Debit Credit Jan.11 Inventory 4410 Accounts payable 4410 To record depreciation for January on the equipment sold Date Account title Debit Credit Jan.15 Depreciation expense 200 Accumulated depreciation 200 To record sale of equipment for $23,000 Date Account title Debit Credit Jan.15 Cash 23000 Acumulated depreciation 2600 Equipment 25000 Gain on sale of equipment 600 Sale of equipment Cost 25000 Depreciation for last year 2400 Beginning book value 22600 Depreciation for january 200 Book value at the time of sale 22400 Sale value 23000 Gain on sale of equipment 600 Depreciation per year (24,000/5) 4800 Depreciation per month 400 To record payroll for Jan.1 - 15 period. Date Account title Debit Credit Jan.15 Salaries expense 2000 Withheld income taxes payable 250 FICA taxes payable 150 Salaries payable 1600 To record employer payroll taxes for Jan.1 - 15 period. Date Account title Debit Credit Jan.15 Payroll taxes 200 FICA payable 150 Unemployment taxes payable 50 To record payment of note payable Date Account title Debit Credit Jan.17 Note payable 22000 Interest payable 495 Interest expense 90 Unemployment taxes payable 22585

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