Question :
181.The unadjusted trial balance of Rapido Delivery entered the partial : 1236885
181.The unadjusted trial balance of Rapido Delivery is entered on the partial work sheet below. Complete the work sheet using the following information: (a) Salaries earned by employees that are unpaid and unrecorded, $5,000. (b) An inventory of supplies showed $1,000 of unused supplies still on hand. (c) Depreciation on delivery vans, $24,000. (d) Services paid in advance by customers of $10,000 have now been provided to customers.
Rapido DeliveryWork SheetFor the year ended December 31
AccountUnadjusted Trial BalanceAdjustmentsAdjusted Trial BalanceIncome StatementBalance Sheet and Statement of Owner s Equity
DebitCreditDebitCreditDebitCreditDebitCreditDebitCredit
Cash70,000
Accounts Receivable10,000
Supplies3,000
Delivery Vans120,000
Accum. Depr.—Vans48,000
Accounts payable15,000
Unearned fees20,000
Salaries payable
B. Rapid, Capital55,000
B. Rapid, Withdrawals50,000
Fees earned320,000
Salary expense177,000
Rent expense28,000
Supplies expense
Depreciation expense
Totals458,000458,000
182.The following December 31 year-end adjusted trial balance is for Heath Wilmer Co. The credit balance in Heath Wilmer, Owner Capital at the beginning of the year, January 1, was $320,000. The owner, Heath Wilmer, invested an additional $300,000 during the current year. The land held for future expansion was also purchased during the current year.
HEATH WILMER CO.ADJUSTED TRIAL BALANCEDECEMBER 31
Cash$90,000
Accounts receivable18,000
Prepaid insurance6,000
Office supplies2,000
Investments in stocks150,000
Land held for future expansion300,000
Office equipment18,000
Accumulated depreciation—Equipment$4,000
Building600,000
Accumulated depreciation—Building170,000
Intangible assets—licensing agreement50,000
Accounts payable17,800
Salaries payable16,400
Long-term note payable224,000
Heath Wilmer, Capital620,000
Heath Wilmer, Withdrawals60,000
Service fees earned470,800
Salaries expense180,000
Insurance expense12,000
Rent expense25,000
Depreciation expense—Equipment2,000
Depreciation expense—Building10,000
Totals$1,523,000$1,523,000
Required: 1. Prepare a classified year-end balance sheet. (Note: A $22,000 installment on the long-term note payable is due within one year.) 2. Using the information presented: (a) Calculate the current ratio. Comment on the ability of Heath Wilmer Co. to meets its short-term debts. (b) Calculate the debt ratio and comment on the financial position and risk analysis of Heath Wilmer Co. (c) Using the account balances to analyze the financial position of Heath Wilmer Co., why would the owner need to invest an additional $300,000 in the business when the business is already profitable and the owner had an existing capital balance of $320,000? 183.Mandalay Company frequently has accrued expenses at the end of its fiscal year that should be recorded for proper financial statement presentation. Mandalay pays on a weekly basis and has $50,000 of accrued salaries incurred but not paid for June 30, its fiscal year-end. This consists of one day’s accrued salaries for the week. The company will pay its employees $250,000 on July 4; the one day of accrued salaries and the remaining four days for July salaries. Record the following entries:(a) Accrual of the salaries on June 30.(b) Payment of the salaries on July 4, assuming that Mandalay does not prepare reversing entries.(c) Assuming that Mandalay prepares reversing entries, reverse the adjusting entry made on June 30.(d) Assuming that Mandalay prepares reversing entries, payment of the salaries on July 4.
