Dear All,
My name is Mike and I am actually an IT guy but during my training I have an accounting module to fulfill. I have to admit, that I have no clue about accounting (I have actually you, to do the job and I am responsible for IT). Even so, I started my first week and am already struggling with my first task and would like to have some help. I am really sorry, because you will laugh at me, how simple it is but for me, the logical part is missing.
During my first week, I have the following question and if you ask me, it is not the best setup and not very clear and please just give me the most easiest suggestion. Where I am struggling already at Jan. 4 where the advertisement is coming in.
I started step by step (we are using the book: "ACCOUNTING AND FINANCE FOR NON-SPECIALISTS,
Peter Atrill, Eddie McLaney,
EIGHTH EDITION"
but I am not too happy with it.
What I have figured out by myself is the following (Unfortunately, not too much, sorry)
Can you please guide me and help me with the task... I have already asked some of my colleagues and it seems, that many of the questions are not clear and therefore, I shall keep it simple.
Thank you very much for your help from a lost soul in accounting,
Mike
The following events occurred during the first month of operations for XYZ Corp, a company specialised in providing software to motorcycle manufacturers.
Jan. 1 The shareholders invested £300,000 in cash, a land worth £100,000 and a building worth £250,000 in exchange for common shares.
Jan. 2 In order to develop a research facility, XYZ acquired computer equipment for £175,000. The purchase price was paid 20% in cash and the remaining on a note.
Jan. 4 XYZ issued an advertisement in the newspaper in order to recruit a research lab specialist. The ad will run throughout the month and will cost £1,500. The invoice was received on the 15th of the month.
Jan. 31 The research specialist worked for the last 2 weeks of the month. The salary of £5,500 was paid on the last day of the month.
Jan. 31 The company started shipping products during the last week of the month. During that period, sales amounted to £265,000, all received in cash except for £15,000, which was sold on account.
Jan. 31 At the end of the month, XYZ received a bill from My Telecomm Ltd. for its telephone, Internet and cell phone charges. The total of the invoice amount to £750 to be paid by the end of the following month. In addition, the company paid the newspaper company for the advertisement services provided.
Jan. 31 To ensure the survival of the company in case of an incident, the company prepaid £5,000 for an annual insurance policy with coverage starting at the beginning of the following month.
Jan. 31 Given the success of the company, the board of directors declared and paid a dividend of £15,000.
To answer this question:
Prepare the journal entries for the current month. Do not prepare any entries for transactions that relate to the following month.
My name is Mike and I am actually an IT guy but during my training I have an accounting module to fulfill. I have to admit, that I have no clue about accounting (I have actually you, to do the job and I am responsible for IT). Even so, I started my first week and am already struggling with my first task and would like to have some help. I am really sorry, because you will laugh at me, how simple it is but for me, the logical part is missing.
During my first week, I have the following question and if you ask me, it is not the best setup and not very clear and please just give me the most easiest suggestion. Where I am struggling already at Jan. 4 where the advertisement is coming in.
I started step by step (we are using the book: "ACCOUNTING AND FINANCE FOR NON-SPECIALISTS,
Peter Atrill, Eddie McLaney,
EIGHTH EDITION"
but I am not too happy with it.
What I have figured out by myself is the following (Unfortunately, not too much, sorry)
Can you please guide me and help me with the task... I have already asked some of my colleagues and it seems, that many of the questions are not clear and therefore, I shall keep it simple.
Thank you very much for your help from a lost soul in accounting,
Mike
The following events occurred during the first month of operations for XYZ Corp, a company specialised in providing software to motorcycle manufacturers.
Jan. 1 The shareholders invested £300,000 in cash, a land worth £100,000 and a building worth £250,000 in exchange for common shares.
Jan. 2 In order to develop a research facility, XYZ acquired computer equipment for £175,000. The purchase price was paid 20% in cash and the remaining on a note.
Jan. 4 XYZ issued an advertisement in the newspaper in order to recruit a research lab specialist. The ad will run throughout the month and will cost £1,500. The invoice was received on the 15th of the month.
Jan. 31 The research specialist worked for the last 2 weeks of the month. The salary of £5,500 was paid on the last day of the month.
Jan. 31 The company started shipping products during the last week of the month. During that period, sales amounted to £265,000, all received in cash except for £15,000, which was sold on account.
Jan. 31 At the end of the month, XYZ received a bill from My Telecomm Ltd. for its telephone, Internet and cell phone charges. The total of the invoice amount to £750 to be paid by the end of the following month. In addition, the company paid the newspaper company for the advertisement services provided.
Jan. 31 To ensure the survival of the company in case of an incident, the company prepaid £5,000 for an annual insurance policy with coverage starting at the beginning of the following month.
Jan. 31 Given the success of the company, the board of directors declared and paid a dividend of £15,000.
To answer this question:
Prepare the journal entries for the current month. Do not prepare any entries for transactions that relate to the following month.