Answer:
Check the explanation
Explanation:
General Journal
Ref. Account Title & explanation Debit Credit
a) Cash $1,200,000
Contribution $400,000
Long term liability $800,000
(To record receipt of fund )
b) Equipment $890,000
Cash $890,000
(To record purchase of equipment)
c) Supplies $120,000
Accounts payable $30,000
Cash $90,000
(To record purchase of supplies)
d) Cash $350,000
Accounts receivable $50,000
Sales $400,000
(To record sales )
e) Supplies expenses $73,000
Supplies $73,000
(To record supllies expenses)
f) Salaries and wages expenses $19,000
Cash $19,000
(To record salaries and wages expenses)
Utilities expenses $3,000
Cash $3,000
(To record utilities expenses)
g) Depreciation expenses $80,000
Accumulated depreciation-Equipment $80,000
(To record depreciation expenses)
h) Long term liability $200,000
Cash $200,000
(To record payment of instalment of advance)
Ref. CASH ACCOUNT Debit Credit
a) Contribution $400,000
a) Long term liabilities $800,000
b) Equipment $890,000
c) Supplies $90,000
d) Sales $350,000
f) Salaries & wages expenses $19,000
f) Utilities expenses $3,000
h) Long term liabilities $200,000
Balance $348,000
TOTAL $1,550,000 $1,550,000
Closing balance brought forward $348,000
TRIAL BALANCE
Account Debit Credit
Cash $348,000
Contribution $400,000
Long term liabilities $600,000
Equipment $890,000
Supples $ 47,000 (120000-73000)
Accounts payable $30,000
Accounts receivable $50,000
Sales $400,000
Supplies expenses $73,000
Salaries and wages expenses $19,000
Utilities expenses $3,000
Depreciation expenses $80,000
Accumulated depreciation-equipment $80,000
TOTAL $1,510,000 $1,510,000
INCOME STATEMENT
Contribution $400,000
Sales $400,000
Total income $800,000
Expenses:
Supplies expenses $73,000
Salaries and wages expenses $19,000
Utilities expenses $3,000
Depreciation expenses $80,000
Total expenses $175,000
Net Income $625,000
BALANCE SHEET
ASSETS:
Cash $348,000
Supples $ 47,000
Accounts receivable $50,000
Equipment $890,000
Accumulated depreciation ($80,000)
Total assets $1,255,000
Liabilities:
Accounts payable $30,000
Long term liabilities $600,000
Net assets $625,000
Total Liabilities & net assets $1,255,000
