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Problem 3-70B Comprehensive Problem: Reviewing the Accounting Cycle Wilburton Riding Stables provides stables, care for animals, and grounds for riding and showing horses. The account balances at the beginning of 2019 were: During 2019, the following transactions occurred: Wilburton provided animal care services, all on credit, for $210,300. Wilburton rented stables to customers for $20,500 cash. Wilburton rented its grounds to individual riders, groups, and show organizations for $41,800 cash. There remains $15,600 of accounts receivable to be collected at December 31, 2019. Feed in the amount of $62,900 was purchased on credit and debited to the supplies Straw was purchased for $7,400 cash and debited to the supplies account. Wages payable at the beginning of 2019 were paid early in 2019. Wages were earned and paid during 2019 in the amount of $12,000. The income taxes payable at the beginning of 2019 were paid early in 2019. Payments of $73,000 were made to creditors for supplies previously purchased on credit. One year’s interest at 9% was paid on the note payable on July 1, 2019. During 2019, Jon Wilburton, a principal stockholder, purchased a horse for his Wife, Jennifer, to ride. The horse cost $7,000, and Wilburton used his personal credit to purchase it. The horse is stabled at the Wilburton home rather than at the riding stables. Property taxes were paid on the land and buildings in the amount of S17,000. Dividends were declared and paid in the amount Of The following data are available for adjusting entries: • Supplies (feed and straw) in the amount of $30,400 remained at year end. • Annual depreciation on the buildings is $6,000. • Annual depreciation on the equipment is • Wages of $4,000 were unrecorded and unpaid at year end. • Interest for 6 months at 9% per year on the note is unpaid and unrecorded at year end. • Income taxes of $16,500 were unpaid and unrecorded at year end. Required: Post the 2019 beginning balances to T-accounts. Prepare journal entries for Transactions a through j and post the journal entries to T-accounts, adding any new T-accounts you need. Prepare the adjustments and post the adjustments to the T-accounts, adding any new T-accounts you need. Prepare an income statement. Prepare a retained earnings statement. Prepare a classified balance sheet Prepare closing entries. CONCEPTUAL CONNECTION Did you include Transaction g among Tarkington’s 2019 journal entries? Why or why not?

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Cornerstones of Financial Accounti...

4th Edition
Jay Rich + 1 other
Publisher: Cengage Learning
ISBN: 9781337690881
BuyFind

Cornerstones of Financial Accounti...

4th Edition
Jay Rich + 1 other
Publisher: Cengage Learning
ISBN: 9781337690881

Solutions

Chapter
Section
Chapter 3, Problem 70APSA
Textbook Problem

Problem 3-70B Comprehensive Problem: Reviewing the Accounting Cycle

Wilburton Riding Stables provides stables, care for animals, and grounds for riding and showing horses. The account balances at the beginning of 2019 were:

Chapter 3, Problem 70APSA, Problem 3-70B Comprehensive Problem: Reviewing the Accounting Cycle Wilburton Riding Stables

During 2019, the following transactions occurred:

  1. Wilburton provided animal care services, all on credit, for $210,300. Wilburton rented stables to customers for $20,500 cash. Wilburton rented its grounds to individual riders, groups, and show organizations for $41,800 cash.
  2. There remains $15,600 of accounts receivable to be collected at December 31, 2019.
  3. Feed in the amount of $62,900 was purchased on credit and debited to the supplies
  4. Straw was purchased for $7,400 cash and debited to the supplies account.
  5. Wages payable at the beginning of 2019 were paid early in 2019. Wages were earned and paid during 2019 in the amount of $12,000.
  6. The income taxes payable at the beginning of 2019 were paid early in 2019.
  7. Payments of $73,000 were made to creditors for supplies previously purchased on credit.
  8. One year’s interest at 9% was paid on the note payable on July 1, 2019.
  9. During 2019, Jon Wilburton, a principal stockholder, purchased a horse for his Wife, Jennifer, to ride. The horse cost $7,000, and Wilburton used his personal credit to purchase it. The horse is stabled at the Wilburton home rather than at the riding stables.
  10. Property taxes were paid on the land and buildings in the amount of S17,000.
  11. Dividends were declared and paid in the amount Of

The following data are available for adjusting entries:

• Supplies (feed and straw) in the amount of $30,400 remained at year end.

• Annual depreciation on the buildings is $6,000.

• Annual depreciation on the equipment is

• Wages of $4,000 were unrecorded and unpaid at year end.

• Interest for 6 months at 9% per year on the note is unpaid and unrecorded at year end.

• Income taxes of $16,500 were unpaid and unrecorded at year end.

Required:

  1. Post the 2019 beginning balances to T-accounts. Prepare journal entries for Transactions a through j and post the journal entries to T-accounts, adding any new T-accounts you need.
  2. Prepare the adjustments and post the adjustments to the T-accounts, adding any new T-accounts you need.
  3. Prepare an income statement.
  4. Prepare a retained earnings statement.
  5. Prepare a classified balance sheet
  6. Prepare closing entries.
  7. CONCEPTUAL CONNECTION Did you include Transaction g among Tarkington’s 2019 journal entries? Why or why not?

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Chapter 3 Solutions

Cornerstones of Financial Accounting
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