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Bug Out Pest Control has the following

Price: $12.99

Five Questions

Question 1
Bug Out Pest Control has the following balances in selected accounts on December 31, 2012.

Accounts Receivable $ 0
Accumulated Depreciation – Equipment 0
Equipment 6,650
Interest Payable 0
Notes Payable 15,000
Prepaid Insurance 2,220
Salaries and Wages Payable 0
Supplies 2,940
Unearned Service Revenue 30,000
All of the accounts have normal balances. The information below has been gathered at December 31, 2012.
1. Depreciation on the equipment for 2012 is $1,300.
2. Bug Out Pest Control paid $2,220 for 12 months of insurance coverage on October 1, 2012.
3. Bug Out Pest Control performed disinfecting services for a client in December 2012. The client will be billed $3,200.
4. On December 1, 2012, Bug Out Pest Control collected $30,000 for disinfecting processes to be performed from December 1, 2012, through May 31, 2012.
5. A count of supplies on December 31, 2012, indicates that supplies of $650 are on hand.

Instructions: Prepare in journal form, without explanations, the end of year adjusting entries for the items listed for Bug Out Pest Control

Question 2
At March 31, account balances after adjustments for Jerry’s Cinema are as follows (All account balances are normal):

Accounts Balance
Cash $6,000
Supplies 4,000
Equipment 50,000
Accumulated Depreciation, Equipment 12,000
Accounts Payable 5,000
Jerry’s, Capital 20,000
Jerry’s, Drawings 12,000
Admission Ticket Revenues 60,000
Popcorn Revenues 32,000
Candy Revenues 21,000
Advertising Expense 18,000
Supplies Expense 19,000
Depreciation Expense 4,000
Rent Expense 28,000
Salaries and Wages Expense 24,000
Utilities Expense 5,000

Instructions: Prepare in journal form, without explanations, the closing journal entries for Jerry’s Cinema. In addition to the accounts presented you will need to use the Income Summary account to accomplish this task.

Question 3
The following information is available for Hay’s Company for the year ended December 31, 2012:

Accounts payable $2,300
Accumulated depreciation, equipment 4,000
Hay’s capital 9,300
Intangible assets 2,300
Notes payable (due in 5 years) 5,000
Accounts receivable 1,500
Cash 1,300
Short-term investments 1,000
Equipment 8,800
Long-term investments 5,700

Instructions: Use the above information to prepare a classified balance sheet for the year ended December 31, 2012. (All account balances are normal.)

Question 4
Compute bad debts expense based on the following information

(a) ABC Company estimates that 2% of net credit sales will become uncollectible. Sales are $600,000, sales returns and allowances are $30,000, and the allowance for doubtful accounts has a $6,000 credit balance.

(b) ABC Company estimates that 10% of accounts receivable will become uncollectible. Accounts receivable are $100,000 at the end of the year, and the allowance for doubtful accounts has a $500 debit balance.

Question 5
Mozart Company uses the allowance method for estimating uncollectible accounts. Prepare in journal form, without explanations, the entries to record the following transactions

January 5 Sold merchandise to Antonio Salieri for $2,000, terms n/15.

April 15 Received $600 from Antonio Salieri on account.

August 21 Wrote off as uncollectible the balance of the Antonio Salieri account when she declared bankruptcy.

October 5 Unexpectedly received a check for $300 from Antonio Salieri. It is not felt any more will be received from Winston

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