The following transactions took place during May 2015
Day Trans# Desc
1 2101 In order to provide snacks for guests on a 24 hour basis, Night signed a contract with Snack Attack. Snack Attack will install vending machines with food and drinks and pay a 10% commission on all sales. Estimated payments are made at the beginning of each month. Night received a check for $200, the estimated commission on sales for May.
2 2102 Night purchased a surround sound system and big screen TV with a Digital Satellite System for the guest lounge. The surround sound system cost $3,600 and has an estimated useful life of 5 years, and no salvage value. The TV cost $8,000 and has an estimated useful life of 8 years, and a salvage value of $800. Night paid cash for both items.
2 2103 Paid for May’s programming on the new Digital Satellite System, $125.
3 2104 Night’s office manager returned $100 worth of office supplies to Gordon Office Supply. Night received a $100 reduction in our account with Gordon.
3 2105 Deposited registration fees, $52,700
3 2106 Paid rent for lodge and campgrounds for the month of May, $40,000.
3 2107 In preparation for the purchase of a nearby campground, Night invested an additional $600,000.
4 2108 Paid Gordon Office Supply on account, $400.
4 2109 Purchased the assets of a competing business and paid cash for the following: land $100,000, lodge $530,000 and fishing boats $9,000. The lodge has a remaining useful life of 50 years and a $50,000 salvage value. The boats have remaining lives of 5 years and zero salvage value.
5 2110 Paid May’s insurance premium for the new camp, $1,000
5 2111 Purchased food supplies from Acme Super Market on account, $22,950.
5 2112 Purchased office supplies from Gordon Office Supplies on account, $1,200.
7 2113 Night paid $40 each for one-year subscriptions to Fishing Illustrated, Fishing Unlimited, and Fish Master. The magazines are published monthly.
10 2114 Deposited registration fees, $62,750
13 2115 Paid wages to fishing guides, $30,000. (Don’t forget wages payable.)
14 2116 A guest because ill and was unable to stay for the entire week. A refund was issued in the amount of $1,000.
17 2117 Deposited registration fees, $63,000.
19 2118 Purchased food supplies from Acme Super Market on account, $18,400.
21 2119 Deposited registration fees, $63,400
23 2120 Paid $2,500 for advertising spots on National Sports Talk Radio
25 2121 Paid repair fee for damaged boat, $ 850.
27 2122 Paid wages to fishing guides, $30,000.
28 2123 Paid $1,800 for advertising spots on billboards.
29 2124 Purchased food supplies from Acme Super Market on account, $14,325.
30 2125 Paid utilities bill, $3,300
30 2126 Paid telephone bill, $1,800.
30 2127 Paid Acme Super Market on account, $47,350.
31 2128 Bob Night withdrew cash for personal use, $7,500.
Adjustment information at the end of May is provided below.
Total vending machine sales were $2,300 for the month of May. A 10% commission is earned on these sales.
Straight-line depreciation is used for the 10 boats purchased on April 2nd for $60,000. The useful life for these assets is 5 years and there is no salvage value. A full month’s depreciation was taken in April on these boats. Straight-line depreciation is also used for the two boats purchased in May. Make one adjusting entry for all depreciation on the boats.
Straight line depreciation is used to depreciate the surround sound system.
Straight line depreciation is used to depreciate the big screen TV.
Straight line depreciation is used for the building purchased in May.
On April 2nd Night paid $9,000 for insurance during the six-month camping season. May’s portion of this premium was used up during this month.
Night received his May issues of Fishing Illustrated, Fishing Unlimited, and Fish Master.
Office supplies remaining on hand, $150.
Food supplies remaining on hand, $5,925.
Wages earned, but not yet paid, at the end of May, $6,000.
Enter the above transactions in a general journal. Enter transactions from May 1-4 on page 5, May 5-28 on page 6, and the remaining entries on page 7. To save time and space, don’t enter descriptions for the journal entries.
Post the entries to the general ledger. (If you are not using the working papers that accompany this text, you will need to enter the account titles, account numbers, and balances from April 30 in the general ledger accounts.)
Prepare a trial balance on a work sheet.
Complete the work sheet.
Journalize the adjusting entries on page 8 of the general journal.
Post the adjusting entries to the general ledger.
Prepare the income statement.
Prepare the statement of owner’s equity
Prepare the balance sheet.
Journalize the closing entries on page 9 of the general journal.
Post the closing entries to the general ledger.
Prepare a post-closing trial balance.