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Adjustment information as of September 30, 2013 not already given in original transactions: Joe was very...

TUCKER BOATS Tucker Boats began business on September 1, 2013, as a retail sales outlet for Swellcraft water- ski and fishingDESCRIPTIONS OF EVENTS OCCURRING Sept. 1 - 30 Date Description of Event 1 Sept. 1, 2013 Joe, with the help and advice of his7 Sept. 6, 2013 Tucker Boats purchased, at a cost of $11,500, a Fast Glass model Swell craft ski boat for resale. Transportat12 Sept. 11, 2013 13 Sept. 13, 2013 14 Sept. 13, 2013 15 Sept. 14, 2013 of Joe, agreed to pay the $220 invoice within Tucker21 Sept. 21, 2013 22 Sept. 21, 2013 23 Sept. 22, 2013 Tucker Boats paid Swellcraft the $11,500 it owed on its purchase of the26 Sept. 24, 2013 27 Sept. 24, 2013 28 Sept. 25, 2013 29 Sept. 25, 2013 Frank Hammons, an avid skier, purchased a slalom ski

Adjustment information as of September 30, 2013 not already given in original transactions:

  1. Joe was very conscientious in checking his customers' credit history. However, while at the Nevada State Boat Show, he learned that it is customary within the pleasure boating industry for retail boat sales to suffer bad debt losses equal to 5% of credit sales. Joe decides that it is prudent to use the 5% industry-wide standard until he has more experience with his own business and customers. Round estimate to the nearest dollar.
  2. As a control measure, Joe counts his inventory of skiing and fishing accessories at 9/30/2020. He determines that the cost of this merchandise on hand is $1,140.
  3. Joe counts his Supplies after the close of business on the last day of the month and determines the cost of unused supplies to be $262.
  4. Joe estimates that his office furniture and boat related equipment will last eight years with no salvage. Fixed assets purchased in the first half of the month are depreciated for the entire month, while fixed assets purchased in the last half of the month are not depreciated until the second month. Depreciation is rounded to the nearest dollar.
  5. Henry worked 20 days during September and did not work any overtime. Joe gets a monthly salary of $3,000.
  6. On October 4, Tucker Boats received a $357 invoice from Desert Gas and Electric Company for utilities consumed during September.
  • 1) prepare the journal entries for all the transactions(with description) listed in the project description file.Preview the document The Chart of Accounts in the file has all the accounts listed. And then, you shall

- 2) prepare the T-accounts. To complete the journal entries, do not forget that you need to make the adjusting entries per the descriptions of transactions in the project document.

- 3) The last tab in the Excel template is for you to prepare the unadjusted trial balance, as well as the adjusted trial balance. Note that you need to enter all the adjustments in the worksheet.

- 4) The last step of the project is to make the closing entries. You shall close the Revenue account(s) as well as the Expenses accounts to the income summary and the then close to the Retailed Earnings.

TUCKER BOATS Tucker Boats began business on September 1, 2013, as a retail sales outlet for Swellcraft water- ski and fishing boats. Tucker Boats is located on Oe outskirts of Las Vegas, Nevada, and the area provides skiers and fishermen with ample opportunities for boating recreation at nearby Lake Mead. Joe Tucker was excited that he was able to get his business established before the spring, so that he would have his operations running smoothly by the peak sales period during spring and early summer. Tucker Boats has adopted a September 30 as fiscal year end, just in time to stock new merchandise. On September 1, Joe and his attorney were involved with issuing the stock of this closely-held corporation. On this same date, he hired a recent graduate of a local trade school, Henry Webster, to be responsible for boat repairs. In the next few days of September, he rented a sales office, boat garage, and lot space. The store is open Monday through Saturday and Joe is there all six days. Henry works 8 hours per day, Monday through Friday. Both Henry and Joe are employees of the corporation. The next page shows Tucker Boat's chart of accounts. Following are descriptions of events occurring during September. After October begins, you are to close the accounts. Note: Since this is a new business, there are no beginning balances in your accounts.
DESCRIPTIONS OF EVENTS OCCURRING Sept. 1 - 30 Date Description of Event 1 Sept. 1, 2013 Joe, with the help and advice of his attorney, Jason Rutherford, issued to himself 5,000 shares of Tucker Boats, Incorporated common stock (no par) at a price of $20 per share. Joe transferred $100,000 cash from his personal bank account and deposited it in a checking account in the name of Tucker Boats, Incorporated Tucker Boats hired Henry at $10 per hour. Henry's typical work week will be 8 hours a day, 5 days per week. Joe and Henry are paid on the first of each month for the month just ended. 2 2 Sept. 1, 2013 3 3 Sept. 1, 2013 4 st Sept. 1, 2013 5 Sept. 4, 2013 6 Sept. 6, 2013 Tucker Boats paid Far West Insurance Agency a one-year general property and liability insurance premium of $2,196. Tucker Boats paid $2,400 to Ace Property Management Group for September's rent on the sales office and boat lot. Tucker Boats wrote a $900 check to Jason Rutherford to pay for his assistance in issuing the common stock. Tucker Boats purchased boat moving equipment, office furniture, and boat repair machinery. Tucker Boats paid $6,880 in cash and signed a four-year, 9.6%, $20,000 installment note payable to First National Bank. Equal monthly principal and interest payments of $503.42 are due the 5th of each month, beginning October 6. (The note assumes a 360-day year and 30 days of interest charged for each full month. Months with 31 days accrue only 30 days of interest, but so does September. The date the loan is signed bears interest. Interest is accrued to the nearest penny.)
7 Sept. 6, 2013 Tucker Boats purchased, at a cost of $11,500, a Fast Glass model Swell craft ski boat for resale. Transportation cost from the Swellcraft factory to Tucker Boats was $550, which Tucker paid in cash. Tucker uses a perpetual inventory system for both boats and accessories. Payment terms to Swellcraft are net 60 days or within two days of the sale of the boat. Tucker Boats purchased on account a variety of accessory merchandise at a cost of $1,330 from Miller Ski Supplies. Transportation was paid by Miller. Terms are net 30 days. Tucker Boats purchased supplies costing $760, paying cash. 8 8 Sept. 7, 2013 9 Sept. 8, 2013 10 Sept. 9, 2013 John Phillips, a local ski enthusiast, provided Tucker Boats with its first sale when he bought a $490 slalom ski for cash. The ski had been included in the September 7 purchase and had cost Tucker $350. 11 Sept. 11, 2013 Albert Snell, another skier, brought his Manvader ski boat in to be "winterized." Henry changed both the engine and outdrive oil, drained the water from the engine, replaced the spark plugs, and tuned the engine. Albert, a long time friend
12 Sept. 11, 2013 13 Sept. 13, 2013 14 Sept. 13, 2013 15 Sept. 14, 2013 of Joe, agreed to pay the $220 invoice within Tucker Boats' customary 30-day trade terms. Sold Frank Featherstone a dry suit with a $410 price. After checking his credit, he was allowed the 30-day trade terms. The dry suit also was included in the September 7 purchase and had cost $225. Tucker Boats purchased additional accessory merchandise from Fisherman's Warehouse at a cost of $860. Tucker agreed to the 15-day payment terms from Fisherman's and paid $40 cash to a trucking firm for transportation. Tucker Boats paid Admirable Advertising Agency $180 for a newspaper advertisement to carried in the Saturday, September 18 edition of the Las Vegas Gazette. After inspecting the merchandise from Fisherman's Warehouse on September 13, Joe noticed that part of the merchandise was damaged. Tucker Boats returned the damaged merchandise, which had cost $130, and received a debit memorandum from Fisherman's Warehouse. Art Jensen, a new customer, purchased fishing gear at a price of $335, paying cash. The merchandise was included in the September 13 purchase at a cost of $222. Joe was hopeful that his upcoming newspaper advertisement would bring in boat customers, so he purchased a 15-foot, Swellcraft fishing boat with a 25- horsepower outboard motor. Tucker Boats received an invoice for $7,800 from Swellcraft and paid $310 cash for transportation. Tucker Boats' advertisement in the morning paper paid off when Lance Layitover signed a sales contract to buy the Fast Glass Swellcraft ski boat for an "out-the-door" price of $18,999. The sale was contingent on Lance's arranging bank financing. Tucker Boats had a booth in the Nevada State Boat Show to be held Sunday, September 26, paying the organizers of the event $300. Lance delivered the bank's check for $17,000 and his own for the balance of $1,999 to finalize the sale of the Swellcraft ski boat. 16 Sept. 15, 2013 17 Sept. 15, 2013 18 Sept. 18, 2013 19 Sept. 18, 2013 20 Sept. 20, 2013
21 Sept. 21, 2013 22 Sept. 21, 2013 23 Sept. 22, 2013 Tucker Boats paid Swellcraft the $11,500 it owed on its purchase of the Swellcraft ski boat. Henry finished repairs and maintenance jobs on several boats. Cash receipts for this work amounted to $1,755. Tucker Boats' advertisement was so successful that he paid another $180 for an advertisement in the September 24 morning edition of the Gazette. Tucker Boats purchased another Fast Glass Swellcraft ski boat with some additional options that weren't included in the one he sold. The invoice cost was $12,100, which he agreed to pay on the same terms as his first purchase. Transportation cost, which Tucker Boats paid in cash, was $515. Ski accessory sales for cash totaled $704 for the day. The cost of these sales was $425. 24 Sept. 23, 2013 25 Sept. 23, 2013
26 Sept. 24, 2013 27 Sept. 24, 2013 28 Sept. 25, 2013 29 Sept. 25, 2013 Frank Hammons, an avid skier, purchased a slalom ski from the manufacturer's catalogue. He paid the entire $580 price and the ski was ordered because it was not in stock. Tucker Boats wrote a $730 check to pay Fisherman's Warehouse for its September 13 purchase. Accessories costing $545 were sold to Vivian Ellis for a price of $770. Joe's check of her credit qualified her for 30-day credit terms. Additional accessory merchandise costing $827 was purchased from Tackle and Line Shop. Shipping costs were paid for in cash ($23). Payment terms are 30 days. James Murphy, a long-time associate of Joe Tucker, had major repairs to his boat performed during the last week of September. Henry finished the repairs on this date and Murphy was billed $2,329. Payment from James is due in 30 days. Joe and his wife, Martha, who is the Vice-president of Tucker Boats, constitute the Board of Directors. They met and declared a $.30 per share cash dividend, to be paid on March 15, 2021. 30 Sept. 27, 2013 31 Sept. 28, 2013 After you develop the journal entries for the above transactions, you should post the entries to T- accounts and calculate the account balances. These account balances can then be used in making adjusting entries. Using these account balances and additional adjustment information below, record adjusting journal entries. Note that some information needed for adjustments is obtained from the description of the original transaction. For example, Henry's wage rate is given in a Sept. 1 description.
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General Journal
Date Transaction # Journal Entry # Account # Debit Credit
9/1/13 1 1 101 Cash 100,000
301 Common Stock - (no par)                                        100,000
initial investment in Tucker Boats
9/1/13 3 2 132 Prepaid Insurance                                              2,196
101 Cash 2,196
to record payment of annual insurance
9/1/13 4 3 604 Rent Expense                                                   2,400
101 Cash 2,400
to record payment of rent
9/4/13 5 4 301 Common Stock - (no par)                                        900
101 Cash 900
to record payment for issuance of common stock
9/6/13 6 5 141 Store, Office, & Boat Equipment                                26,880
101 Cash 6,880
210 Notes Payables                                                 20,000
to record acquisition of equipment
9/6/13 7 6 121 Boat Inventory                                                 12,050
101 Cash 550
201 Accounts Payable                                              11,500
to record receipt of inventory
9/7/13 8 7 122 Boat Accessory Inventory                                      1,330
201 Accounts Payable                                              1,330
to record receipt of inventory
9/8/13 9 8 131 Supplies                                                       760
101 Cash 760
to record purchase of supplies
9/9/13 10 9 101 Cash 490
502 Cost of Goods Sold - Accessory Sales                           350
402 Accessory Sales                                                490
122 Boat Accessory Inventory                                      350
to record sale of accessories to John Phillips
9/11/13 11 10 111 Accounts Receivable                                            220
403 Boat Repair Revenue                                            220
invoice to Albert Snell for boat repair
9/11/13 12 11 111 Accounts Receivable                                            410
502 Cost of Goods Sold - Accessory Sales                           225
402 Accessory Sales                                                410
122 Boat Accessory Inventory                                      225
to record sale of accessories to Frank Featherstone
9/13/13 13 12 122 Boat Accessory Inventory                                      900
201 Accounts Payable                                              860
101 Cash 40
to record receipt of inventory
9/13/13 14 13 607 Advertising expense                                            180
101 Cash 180
to record payment for advertising
9/14/13 15 14 201 Accounts Payable                                              130
122 Boat Accessory Inventory                                      130
to record return of merchandise
9/15/13 16 15 101 Cash 335
502 Cost of Goods Sold - Accessory Sales                           222
402 Accessory Sales                                                335
122 Boat Accessory Inventory                                      222
to record sale of accessories to Art Jensen
9/15/13 17 16 121 Boat Inventory                                                 8,110
101 Cash 310
201 Accounts Payable                                              7,800
to record receipt of inventory
9/18/13 19 17 607 Advertising expense                                            300
101 Cash 300
to record payment for advertising
9/20/13 20 18 101 Cash 18,999
501 Cost of Goods Sold - Boat Sales                                12,050
401 Boat Sales                                                     18,999
121 Boat Inventory                                                 12,050
to record sale to Lance Layitover
9/21/13 21 19 201 Accounts Payable                                              11,500
101 Cash 11,500
to record payment of vendor invoices
9/21/13 22 20 101 Cash 1,755
403 Boat Repair Revenue                                            1,755
to record repair revenues
9/22/13 23 21 607 Advertising expense                                            180
101 Cash 180
to record payment for advertising
9/23/13 24 22 121 Boat Inventory                                                 12,615
101 Cash 515
201 Accounts Payable                                              12,100
to record receipt of inventory
9/23/13 25 23 101 Cash 704
502 Cost of Goods Sold - Accessory Sales                           425
402 Accessory Sales                                                704
122 Boat Accessory Inventory                                      425
to record ski accessory sales
9/24/13 26 24 101 Cash 580
204 Unearned Revenue                                               580
to record prepaid services
9/24/13 27 25 201 Accounts Payable                                              730
101 Cash 730
to record payment of vendor invoices
9/25/13 28 26 111 Accounts Receivable                                            770
502 Cost of Goods Sold - Accessory Sales                           545
402 Accessory Sales                                                770
122 Boat Accessory Inventory                                      545
to record sale of accessories to Frank Hammons
9/25/13 29 27 122 Boat Accessory Inventory                                      850
101 Cash 23
201 Accounts Payable                                              827
to record receipt of inventory
9/27/13 30 28 111 Accounts Receivable                                            2,329
403 Boat Repair Revenue                                            2,329
to record invoice to James Murphy for repair services
9/28/13 31 29 311 Retained Earnings                                              1,500
205 Dividends Payable                                              1,500
to record dividends payable
9/30/13 A1 609 Doubtful Accounts expense                                                                                   186
112 Allowance for doubtful accounts                                186
to record estimate for bad debts ($3729 x .05)
9/30/13 A2 502 Cost of Goods Sold - Accessory Sales                           43
122 Boat Accessory Inventory                                      43
to reconcile physical inventory to GL ($1183-1140)
9/30/13 A3 602 Supplies Expenses                                              498
131 Supplies                                                       498
to record supplies used during the month ($760-262)
9/30/13 A4 605 Depreciation expense                                           280
142 Accumulated depreciation                                       280
to record depreciation ($26,880/96)
9/30/13 A5 601 Salaries Expenses                                              4,600
202 Accrued Salaries Payable                                       4,600
to accrue salary expense for the month (20x8x10 + 3000)
9/30/13 A6 606 Utilities expense 357
207 Other Accrued expenses payable                                 357
to record utilities expense for the month
9/30/13 A7 603 Insurance Expenses                                             183
132 Prepaid Insurance                                              183
to amortize prepaid insurance (2196/12)
9/30/13 A8 608 Interest expense                                               133
203 Accrued Interest Payable                                       133
to accrue interest due on note payable ((20,000 x .096)/12 = 160 x 25/30)
9/30/13 A9 210 Notes Payables                                                 5,000
206 Current Maturities of long-term debt                           5,000
to record current portion of note payable (20,000/4)
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