Question

23. Analysis of transactions and preparation of income statement and balance sheet. Refer to the information for Patterson Corporation for January, Year 13, in Chapter 2, Problem 2.14, above. The following transactions occur during February. (1) February 1: The firm pays the two-year insurance premium of $2,400 for fire and liability coverage beginning February 1. (2) February 5: Acquires merchandise costing $1,050,000. Of this amount, $1,455 is from suppliers to whom Patterson returned defective merchandise during January but for which the firm had not yet received a refund for amounts paid. Patterson Corpora- tion acquired the remaining purchases on account. (3) During February: Sells merchandise to customers totaling $1,500,000. Of this amount, $4,500 was to customers who had advanced Patterson Corporation cash during Janu- ary. Patterson Corporation makes the remaining sales on account. (4) During February: The cost of the goods sold in transaction (3) was $950,000. (5) During February: Pays in cash selling and administrative expenses of $235,000. (6) During February: Collects $1,206,000 from customer for sales previously made on account. (7) During February: Pays $710,000 to suppliers of merchandise for purchases previously made on account. (8) February 28: Recognizes rent expense for February. (9) February 28: Recognizes depreciation expense of $2,500 for February. Patterson Cor- poration uses an Accumulated Depreciation account. (10) February 28: Recognizes amortization expense of $450 on the patent. Patterson Cor- poration does not use an Accumulated Amortization account for patents; instead, it records the amortized amounts directly to the patent account. (11) February 28: Recognizes an appropriate amount of insurance expense for February. (12) February 28: Recognizes interest expense on the mortgage payable (see transaction (12) in Chapter 2, Problem 2.14). (13) February 28: Recognizes income tax expense for February. The income tax rate is 40%. Income taxes for February are payable by April 15.

Ignore the requirement above about Analysis of the transaction... Prepare the journal entry for (1)-(11)..

Answer 1

Preparation of journal entries for patterson corporations during month february.

Journal entried from 1st to 11th.

Please find attachments for detailed answer.
Page 1 forebare javnal Intervies for Petterton Carparation . during Date Particular Debit credit Ama Camount $ 1 febrway Prepaid Insurance 2400 alc Do To cash alc 2you Being Insurance Prepaid by - Patterson Carporation] (2) Bed 5th Merchandise Purchase ale pr 1050,000 February To all and Payable afe ( Being Merchandise Acquise] 1,050,00 Alesung payanthase Retuin alc Dr- To Purchase Return alc cor. 1455 1455 ft ( Being Defecutive purchase Ret win

Correct Amont $ Page 2 Date Particular Debit Amounts (3) Account receivable rebomary ale po To sale all Being selle merchandisecto eustomer 1,500,000 1,500,000 450 Advance received alepo Halo To Account receivable alc cor: usw le Being Advance receiveel fueom Customer] (u) February [ lost af Good sold ale 950,00 9, 50000 To Inventary ale ) Recognize being lest af Goods Sold

Page 3 Dare (5) Partiular Debit Amounts Credit Braws 2, 35000 To T Felowany Selling of Administrative 235 000 Expenses ale Caith alo [ Being paid selling and administrative expenses] (6) pebermany eash alc 1,200,000 To account Receivable al cor. Being cash me lejved foren Cytomen] 1,206,20 february Allount Payable alepy To Cash ale 719.000 710,000 091. Account Payable (8) XXXX 984h rebrasy Rent expeness ale po - To Rent Payable all Rent Expened