Brandon has recently decided to open his new business of retail of clothes in a store located in the center of Barcelona. During the month of April 2021, , Brandon’s new company BONCO, Ltd. realized the following transaction:
3 of April: BONCO, Ltd. issued to Brandon 100,000 shares in exchange of $350,000 of share capital
3th of April: BONCO, Ltd purchased a shop for $250,000. The price of the land is $100,000 ans the building $150,000. Brandon paid $40,000 in cash and issued a note payable for the remaining part.
4th of April: BONCO, Ltd purchased furniture to FURNISH YOUR SHOP, Inc. for $35,000. BONCO, Ltd paid $12,000 in cash, the remaining will have to be paid the 29th of April.
5th of April: BONCO, Ltd purchased merchandises on account to BIGUP, Inc for $28,000
6th of April: BONCO, Ltd makes some installations in the shop for $7,500 paid in cash
7th of April: BONCO, Ltd hires two employees with a salary $1,500/ month each. Salaries are paid on the last day of the month.
8 of April: BONCO, Ltd purchases little gifts to be offered to clients during the first week of activity for $1,500, paid in cash
16 of April, BONCO, Ltd purchases merchandises to ONSTYLE, Ltd.. on account for $41,000.
22 of April, BONCO, Ltd receives an electricity bill for $900 payable in May
29 of April Bronco Ltd. pays the accounts payable to FURNISH YOUR SHOP, Inc.
30 of April: BONCO, Ltd records the sales of the month of April that amount to $126,000. All sales have been paid in cash.
- Record the transactions of the company on the General Journal (30 points)
- Post the transactions on the appropriate ledger accounts (20 points)
- Prepare an unadjusted trial balance at April 30. (20 points)
Use the following accounts: Cash, Capital Stock, Land, Building, Note payable, Furniture, Inventory, Accounts payable, Salaries payable, Salary expense, Social Security Expense, Social Security payable, Gifts expense, Electricity expense, Revenues (Sales)
Exercise 2:
Calculate the missing balances retained and inventory earning accounts in the following charts (30 points)
Assets Liabilities
Cash 28000 Accounts payable 65000
Accounts receivable 65000 Notes payable 128000
Land 50000 Salaries payable 23000
Building 300000 Taxes payable 49000
Office Equipement 24000
Prepaid insurance 32000 Stockholders equity
Inventory 125000
Capital stock 200000
Retained earnings
Assets Liabilities
Cash 30500 Accounts payable 43000
Accounts receivable 12700 Notes payable 23000
Land 50000 Salaries payable 12000
Building 260000 Taxes payable 75000
Office Equipement 2300
Prepaid insurance 24000 Stockholders equity
Inventory
Capital stock 150000
Retained earnings 207000