PREPARE THE TRIAL BALANCE SECTION OF A 10-COLUMN WORKSHEET.The Game Place is a retail store that sells computer games, owned by Matt Huffman. On December 31, 2019, the firm’s general ledger contained the accounts and balances below.
The Game Place is a retail store that sells computer games, owned by Matt Huffman. On December 31, 2019, the firm’s general ledger contained the accounts and balances below. All account balances are normal. Cash …………………………………………………$ 34,465 Accounts Receivable ……………………………………1,669 Prepaid Advertising ………………………………………480 Supplies …………………………………………………..425 Merchandise Inventory ……………………………….18,500 Store Equipment ………………………………………30,000 Accumulated Depreciation-Store Equipment ………..3,000 Office Equipment ………………………………………4,800 Accumulated Depreciation-Office Equipment ………1,500 Notes Payable, due 2020 ……………………………..22,500 Accounts Payable ………………………………………5,725 Wages Payable Social Security Tax Payable Medicare Tax Payable Unearned Seminar Fees ……………………………….7,500 Interest Payable Matt Huffman, Capital ………………………………43,000 Matt Huffman, Drawing …………………………….18,000 Income Summary Sales …………………………………………………163,660 Sales Discounts ………………………………………….180 Seminar Fee Income Purchases …………………………………………….92,500 Purchases Returns and Allowances ……………………..770 Freight In ………………………………………………..275 Rent Expense …………………………………………26,400 Wages Expense ………………………………………18,000 Payroll Taxes Expense …………………………………1,811 Depreciation Expense-Store Equipment Depreciation Expense-Office Equipment Advertising Expense Supplies Expense Interest Expense ……………………………………….150 INSTRUCTIONS 1. Prepare the Trial Balance section of a 10-column worksheet. The worksheet covers the year ended December 31, 2019. 2. Enter the adjustments below in the Adjustments section of the worksheet. Identify each adjustment with the appropriate letter. 3. Complete the worksheet. ADJUSTMENTS a.-b. Merchandise inventory at December 31, 2019, was counted and determined to be $21,200. c. The amount recorded as prepaid advertising represents $480 paid on September 1, 2019, for six months of advertising. d. The amount of supplies on hand at December 31 was $125. e. Depreciation on store equipment was $4,500 for 2019. f. Depreciation on office equipment was $1,500 for 2019. g. Unearned seminar fees represent $7,500 received on November 1, 2019, for five seminars. At December 31, three of these seminars had been conducted. h. Wages owed but not paid at December 31 were $800. i. On December 31, 2019, the firm owed the employer’s social security tax ($49.60) and Medicare tax ($11.60). j. The note payable bears interest at 8 percent per annum. One month’s interest is owed at December 31, 2016. Analyze: How did the balance of merchandise inventory change during the year ended December 31, 2019? View Solution:
The Game Place is a retail store that sells computer
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