Prepare a balance sheet and trial balance, Financial Accounting

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Requirements:

a.   Record the following transactions in the journal of Howell Consulting. Explanations are not required.

b.   Create T accounts for each transaction (Use the next blank page)

c.   Prepare a trial balance for the end of the period (Use the next blank page)

d.   Prepare a Balance Sheet

e.   Prepare an Income Statement

f.    Prepare a statement of retained earnings (Beginning R/E is $15,000)

Sep. 1 received $150,000 cash and issued common stock.

 4 Purchased supplies, $800, and furniture, $5,000, on account.

 6 Performed Services for a law firm and received $12,000 cash.

 6 Declared dividends in the amount of $4,000

 7 Paid $35,000 cash to acquire land for a future office site.

10 Performed service for a client and received their promise to pay the $2,000 within one week.

 14 Paid for the furniture purchased September 4 on account.

 30 Paid Secretary's salary, $1,600.

 30 Paid Dividends declared on September 6.

  1. Compute Cost of good sold using both FIFO and LIFO from the following data.

Date

Activities

Units Acquired/Sold at Cost

Jan. 1

Beginning Inventory

1500 units @ $14

Jan. 10

Sales

550 units @ $34

Mar. 14

Purchases

400 units @ $19

Mar. 15

Sales

500 units @ $40

July 30

Purchase

600 units @ $11

Oct. 5

Sales

250 units @ $35

Oct. 26

Purchase

100 units  @ $18

1. On January 1, 2007 your company purchased a piece of equipment for $650,000 with a useful life of 15 years and an expected salvage value of $50,000. At the end of year 10 the company revised the life of the equipment to 25 years. What is the depreciation expense taken in year 10? What is the depreciation expense taken in year 11? What is the depreciation expense taken in year 26 after the purchase of the equipment?

2. Using the information from problem 3. What would be the accumulated depreciation on the asset after year four of the purchase? What would be the gain/loss on the asset if sold at the beginning of year 5 for $600,000?


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