Question

JackJoe, Inc. sells toy mice to high end pet stores. It was formed on Jan 1, 20x4 with a sale of $1 par value common stock and the issuance of a Bond. Following is JackJoe's trial balance after the first year of operation, through December 1 20x4. This trial balance does not reflect the transactions that occurred during the last month of the year or adjustments that are necessary, as described by the additional information. The Bond payable was sold on Jan 1 20X4 and is due in 4 years, interest of 7% is payable annually on Dec. 31. JackJoe, Inc. Trial Balance As of December 1, 20X4 Debits Credits Cash $ 19,000 $- Accounts receivable 12,000 Supplies 5,000 Inventory 25,000 Equipment 30,000 Accumulated depreciation Accounts payable 10,000 Bond payable 32,000 Premium on bond 400 Interest payable Capital stock ($1 par) 25,000 Additional paid in capital Dividend Sales 64,000 Sales - Discounts Cost of goods sold Rent expense 16,400 Salaries expense 24,000 Depreciation expense Supplies expense Interest expense $ 131,400 $ 131,400

please answer quetion a and b

Answer 1

A.

Code of Asset accounts will start with 100

Code of Liability account will start with 200

Code of Equity account will start with 300

Code of Revenue account start with 400

Code of Expense account will start with 500

Number 1-001 1-010 1-020 1-030 1-040 1-050 2-001 2-010 2-020 2-030 3-001 3-010 3-020 4-001 4-010 5-001 5-010 5-020 5-030 5-040 5-050 Description Account Type Financial Statement Cash Asset Balance Sheet Accounts Receivable Asset Balance Sheet Supplies Asset Balance Sheet Inventory Asset Balance Sheet Equipment Asset Balance Sheet Accumulated Depreciation Asset Balance Sheet Accounts Payable Liability Balance Sheet Bond Payable Liability Balance Sheet Premium on Bond Liability Balance Sheet Interest Payable Liability Balance Sheet Capital Stock (1 Par) Equity Balance Sheet Additional Paid in Capital Equity Balance Sheet Dividend Equity Balance Sheet Sales Revenue Income Statement Sales Discount Revenue Income Statement Cost of Goods Sold Expense Income Statement Rent Expense Expense Income Statement Salaries Expense Expense Income Statement Depreciation Expense Expense Income Statement Suppies Expense Expense Income Statement Interest Expense Expense Income Statement

B.

The asset and expense account has debit balance

The revenue, liability and equity account has credit balance nature.

Here prepared accounts with have opening balances. Without balance accounts are ommitted from the ledger creation