ABC is Limited Liability Retailer Company. The following transactions took place during 2021 financial year, ending 31 December 2021: 1. The company injected cash in the company in the amount of $200,000. 2. The company sold goods for $ 900,000 on cash and 700,000 on credit during the year. 3. A customer that previously bought a good on credit from ABC LLC for $2000 on 01 December 2021 returned this good on 31 December 2022. No entries have been posted for this return. 4. At the year-end it was determined that a customer owing to the company $5,000 is recognized bankrupt. Adjustment to reflect the effect on accounts receivable balance is required. 5. Purchases were made in the amount of $600,000 for cash and 280,000 on credit. Closing inventory has been valued at $90,000. Assume, that there was Zero beginning inventory balance. 6. The Company purchased equipment at the end of the year at a cost of $70,000 that the company is going to use for 3 years. 7. The company recognized administrative expenses during the year in the amount of $350,000. 8. Distribution expenses in the amount of $85,000 were incurred and paid for delivering goods to its customers. 9. At the year end the company paid to suppliers in the amount of $90,000 10. Income tax expense which is payable in one months after year end was estimated to be $2000. Required: 1. State all journal entries to be recorded based on the above transactions as of 31 December 2021. 2. Present all transactions in relevant ledger accounts. 3. Extract trial balance based on the above information for the year ending 31 December 2021.
ABC is Limited Liability Retailer Company. The following transactions took place during 2021 financial year, ending 31 December 2021:
1. The company injected cash in the company in the amount of $200,000.
2. The company sold goods for $ 900,000 on cash and 700,000 on credit during the year.
3. A customer that previously bought a good on credit from ABC LLC for $2000 on 01 December 2021 returned this good on 31 December 2022. No entries have been posted for this return.
4. At the year-end it was determined that a customer owing to the company $5,000 is recognized bankrupt. Adjustment to reflect the effect on
5. Purchases were made in the amount of $600,000 for cash and 280,000 on credit. Closing inventory has been valued at $90,000. Assume, that there was Zero beginning inventory balance.
6. The Company purchased equipment at the end of the year at a cost of $70,000 that the company is going to use for 3 years.
7. The company recognized administrative expenses during the year in the amount of $350,000.
8. Distribution expenses in the amount of $85,000 were incurred and paid for delivering goods to its customers.
9. At the year end the company paid to suppliers in the amount of $90,000
10. Income tax expense which is payable in one months after year end was estimated to be $2000.
Required:
1. State all
2. Present all transactions in relevant ledger accounts.
3. Extract
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