Tar Heels Unlimited began business on January 1, 2024. During January, the following transactions occurred: January 1 Issue common stock in exchange for $100,000 cash. January 2 Purchase inventory on account for $35,000. January 4 Pay an insurance company $2,400 for a one-year insurance policy. January 10 Sell inventory on account for $12,000. The cost of the inventory was $7,000. January 15 Borrow $30,000 from a local bank and signed a note. Principal and interest at 10% is to be repaid in six months. January 20 Pay employees $6,000 salaries for the first half of the month.. January 22 Sell inventory for $10,000 cash. The cost of the inventory was $6,000. January 24 Pay $15,000 to suppliers for the inventory purchased on January 2. January 26 Collect $6,000 on account from customers. January 28 Pay $1,000 to the local utility company for January gas and electricity. January 30 Pay $4,000 rent for the building. Of this amount, $2,000 is for January rent, and $2,000 is for February rent. Prepaid Rent and Rent Expense are debited for their appropriate amounts. The following information is available on January 31, 2024: 1. One month of insurance has expired (related to January 4 purchase). 2. One-half month of interest is owed (related to January 15 borrowing). 3. Salaries owed to employees at the end of January are $6,000. Requirement General Journal General Ledger Trial Balance Record each of the transactions listed above in the 'General Journal' tab (these are shown as items 1-16). Review the 'General Ledger and the Trial Balance' tabs to see the effect of the transactions on the account balances.
Tar Heels Unlimited began business on January 1, 2024. During January, the following transactions occurred: January 1 Issue common stock in exchange for $100,000 cash. January 2 Purchase inventory on account for $35,000. January 4 Pay an insurance company $2,400 for a one-year insurance policy. January 10 Sell inventory on account for $12,000. The cost of the inventory was $7,000. January 15 Borrow $30,000 from a local bank and signed a note. Principal and interest at 10% is to be repaid in six months. January 20 Pay employees $6,000 salaries for the first half of the month.. January 22 Sell inventory for $10,000 cash. The cost of the inventory was $6,000. January 24 Pay $15,000 to suppliers for the inventory purchased on January 2. January 26 Collect $6,000 on account from customers. January 28 Pay $1,000 to the local utility company for January gas and electricity. January 30 Pay $4,000 rent for the building. Of this amount, $2,000 is for January rent, and $2,000 is for February rent. Prepaid Rent and Rent Expense are debited for their appropriate amounts. The following information is available on January 31, 2024: 1. One month of insurance has expired (related to January 4 purchase). 2. One-half month of interest is owed (related to January 15 borrowing). 3. Salaries owed to employees at the end of January are $6,000. Requirement General Journal General Ledger Trial Balance Record each of the transactions listed above in the 'General Journal' tab (these are shown as items 1-16). Review the 'General Ledger and the Trial Balance' tabs to see the effect of the transactions on the account balances.
Financial Reporting, Financial Statement Analysis and Valuation
8th Edition
ISBN:9781285190907
Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Publisher:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Chapter2: Asset And Liability Valuation And Income Recognition
Section: Chapter Questions
Problem 20PC: Analyzing Transactions. Using the analytical framework, indicate the effect of the following related...
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Transcribed Image Text:Tar Heels Unlimited began business on January 1, 2024. During January, the following transactions occurred:
January 1 Issue common stock in exchange for $100,000 cash.
January 2 Purchase inventory on account for $35,000.
January 4 Pay an insurance company $2,400 for a one-year insurance policy.
January 10 Sell inventory on account for $12,000. The cost of the inventory was $7,000.
January 15 Borrow $30,000 from a local bank and signed a note. Principal and interest at 10% is to be repaid in six
months.
January 20 Pay employees $6,000 salaries for the first half of the month.
January 22 Sell inventory for $10,000 cash. The cost of the inventory was $6,000.
January 24 Pay $15,000 to suppliers for the inventory purchased on January 2.
January 26 Collect $6,000 on account from customers.
January 28 Pay $1,000 to the local utility company for January gas and electricity.
January 30 Pay $4,000 rent for the building. Of this amount, $2,000 is for January rent, and $2,000 is for February
rent. Prepaid Rent and Rent Expense are debited for their appropriate amounts.
The following information is available on January 31, 2024:
1. One month of insurance has expired (related to January 4 purchase).
2. One-half month of interest is owed (related to January 15 borrowing).
3. Salaries owed to employees at the end of January are $6,000.
General
Journal
Requirement
General
Ledger
Trial Balance
Record each of the transactions listed above in the 'General Journal' tab (these are shown as items 1-16). Review the
'General Ledger and the Trial Balance' tabs to see the effect of the transactions on the account balances.
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