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Excalibur Corporation sells video games for personal computers. The unadjusted trial balance as of December 31, 2024, appears below. December 31 is the company's reporting year-end. The company uses the perpetual inventory system. Account Title Cash Accounts receivable Supplies Prepaid rent Inventory Office equipment Accumulated depreciation Accounts payable Salaries payable Notes payable (long-term) Common stock Retained earnings Dividends Sales revenue Cost of goods sold Interest expense Salaries expense Rent expense Supplies expense Utility expense Totals Debits $ 51,760 23,000 Credits 2,700 21,000 54,000 67,000 $ 8,710 26,600 3,200 28,800 80,000 15,300 6,000 215,000 112,500 0 34,750 0 0 4,900 $ 377,610 $ 377,610 Information necessary to prepare the year-end adjusting entries appears below. 1. The office equipment was purchased in 2022 and is being depreciated using the straight-line method over an eight-year useful life with no residual value. 2. Accrued salaries at year-end should be $4,800. 3. The company borrowed $28,800 on September 1, 2024. The principal is due to be repaid in 10 years. Interest is payable twice a year on each August 31 and February 28 at an annual rate of 10%. 4. The company debits supplies when supplies are purchased. Supplies on hand at year-end cost $420. 5. Prepaid rent expired during the period is $13,700. Cash dividends paid to shareholders during the year amounted to $6,000.

Excalibur Corporation sells video games for personal computers. The unadjusted trial balance as of December 31, 2024, appears below. December 31 is the company's reporting year-end. The company uses the perpetual inventory system. Account Title Cash Accounts receivable Supplies Prepaid rent Inventory Office equipment Accumulated depreciation Accounts payable Salaries payable Notes payable (long-term) Common stock Retained earnings Dividends Sales revenue Cost of goods sold Interest expense Salaries expense Rent expense Supplies expense Utility expense Totals Debits $ 51,760 23,000 Credits 2,700 21,000 54,000 67,000 $ 8,710 26,600 3,200 28,800 80,000 15,300 6,000 215,000 112,500 0 34,750 0 0 4,900 $ 377,610 $ 377,610 Information necessary to prepare the year-end adjusting entries appears below. 1. The office equipment was purchased in 2022 and is being depreciated using the straight-line method over an eight-year useful life with no residual value. 2. Accrued salaries at year-end should be $4,800. 3. The company borrowed $28,800 on September 1, 2024. The principal is due to be repaid in 10 years. Interest is payable twice a year on each August 31 and February 28 at an annual rate of 10%. 4. The company debits supplies when supplies are purchased. Supplies on hand at year-end cost $420. 5. Prepaid rent expired during the period is $13,700. Cash dividends paid to shareholders during the year amounted to $6,000.

Financial Accounting
Financial Accounting
15th Edition
ISBN:9781337272124
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Carl Warren, James M. Reeve, Jonathan Duchac
Chapter6: Accounting For Merchandising Businesses
Section: Chapter Questions
Problem 2CPP: Palisade Creek Co. is a merchandising business that uses the perpetual inventory system. The account...
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1. Complete the worksheet below.

2-a. Use the information in the worksheet to prepare an income statement for 2024.

2-b. Use the information in the worksheet to prepare a statement of shareholders’ equity for 2024.

2-c. Use the information in the worksheet to prepare a balance sheet as of December 31, 2024.

3. Prepare the necessary closing entries assuming that adjusting entries have been correctly posted to the accounts.

Excalibur Corporation sells video games for personal computers. The unadjusted trial balance as of December 31, 2024, appears below. December 31 is the company's reporting year-end. The company uses the perpetual inventory system. Account Title Cash Accounts receivable Debits $ 51,760 Credits 23,000 2,700 Supplies Prepaid rent Inventory Office equipment Accumulated depreciation Accounts payable Salaries payable Notes payable (long-term) Common stock Retained earnings Dividends Sales revenue Cost of goods sold Interest expense Salaries expense Rent expense Supplies expense Utility expense Totals 21,000 54,000 67,000 $ 8,710 26,600 3,200 28,800 80,000 15,300 6,000 215,000 112,500 0 34,750 0 0 4,900 $ 377,610 $ 377,610 Information necessary to prepare the year-end adjusting entries appears below. 1. The office equipment was purchased in 2022 and is being depreciated using the straight-line method over an eight-year useful life with no residual value. 2. Accrued salaries at year-end should be $4,800. 3. The company borrowed $28,800 on September 1, 2024. The principal is due to be repaid in 10 years. Interest is payable twice a year on each August 31 and February 28 at an annual rate of 10%. 4. The company debits supplies when supplies are purchased. Supplies on hand at year-end cost $420. 5. Prepaid rent expired during the period is $13,700. Cash dividends paid to shareholders during the year amounted to $6,000.
Transcribed Image Text:Excalibur Corporation sells video games for personal computers. The unadjusted trial balance as of December 31, 2024, appears below. December 31 is the company's reporting year-end. The company uses the perpetual inventory system. Account Title Cash Accounts receivable Debits $ 51,760 Credits 23,000 2,700 Supplies Prepaid rent Inventory Office equipment Accumulated depreciation Accounts payable Salaries payable Notes payable (long-term) Common stock Retained earnings Dividends Sales revenue Cost of goods sold Interest expense Salaries expense Rent expense Supplies expense Utility expense Totals 21,000 54,000 67,000 $ 8,710 26,600 3,200 28,800 80,000 15,300 6,000 215,000 112,500 0 34,750 0 0 4,900 $ 377,610 $ 377,610 Information necessary to prepare the year-end adjusting entries appears below. 1. The office equipment was purchased in 2022 and is being depreciated using the straight-line method over an eight-year useful life with no residual value. 2. Accrued salaries at year-end should be $4,800. 3. The company borrowed $28,800 on September 1, 2024. The principal is due to be repaid in 10 years. Interest is payable twice a year on each August 31 and February 28 at an annual rate of 10%. 4. The company debits supplies when supplies are purchased. Supplies on hand at year-end cost $420. 5. Prepaid rent expired during the period is $13,700. Cash dividends paid to shareholders during the year amounted to $6,000.
Complete the worksheet below. Account Title Unadjusted Trial Balance Adjusting Entries Adjusted Trial Balance Income Statement Balance Sheet Debit Credit Debit Credit Debit Credit Debit Credit Debit Credit Cash $ 51,760 Accounts receivable 23,000 Supplies 2,700 Prepaid rent 21,000 Inventory 54,000 Office equipment 67,000 Accumulated depreciation $ 8,710 Accounts payable 26,600 Salaries payable 3,200 Notes payable (long-term) 28,800 Interest payable 0 Common stock 80,000 Retained earnings 15,300 Dividends 6,000 Sales revenue 215,000 Cost of goods sold 112,500 Interest expense Salaries expense 34,750 Rent expense Supplies expense Utilities Expense 4,900 Depreciation expense Net income Totals 377,610 377,610 $ 0 $ 0 $ 0 $ 0 69 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Transcribed Image Text:Complete the worksheet below. Account Title Unadjusted Trial Balance Adjusting Entries Adjusted Trial Balance Income Statement Balance Sheet Debit Credit Debit Credit Debit Credit Debit Credit Debit Credit Cash $ 51,760 Accounts receivable 23,000 Supplies 2,700 Prepaid rent 21,000 Inventory 54,000 Office equipment 67,000 Accumulated depreciation $ 8,710 Accounts payable 26,600 Salaries payable 3,200 Notes payable (long-term) 28,800 Interest payable 0 Common stock 80,000 Retained earnings 15,300 Dividends 6,000 Sales revenue 215,000 Cost of goods sold 112,500 Interest expense Salaries expense 34,750 Rent expense Supplies expense Utilities Expense 4,900 Depreciation expense Net income Totals 377,610 377,610 $ 0 $ 0 $ 0 $ 0 69 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
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