Accounting -At the beginning of 2013, P & D Enterprises had the following balances in its accounts:

| January 31, 2017

Question
At the beginning of 2013, P & D Enterprises had the following balances in its accounts:

Cash

$13,800

Inventory

6,000

Land

3,300

Common stock

11,000

Retained earnings

12,100

During 2013, P & D Enterprises experienced the following events:

1.

Purchased inventory costing $12,500 on account from Stone Company under terms 2/10, n/30. The merchandise was delivered FOB shipping point. Freight costs of $930 were paid in cash.

2.

Returned $600 of the inventory that it had purchased because the inventory was damaged in transit. The seller agreed to pay the return freight cost.

3.

Paid the amount due on its account payable to Stone Company within the cash discount period.

4.

Sold inventory that had cost $10,500 for $18,500. The sale was on account under terms 2/10, n/45.

5.

Received merchandise returned from a customer. The merchandise had originally cost $1,850 and had been sold to the customer for $2,400 cash. The customer was paid $2,400 cash for the returned merchandise.

6.

Delivered goods in Event 4 FOB destination. Freight costs of $820 were paid in cash.

7.

Collected the amount due on accounts receivable within the discount period.

8.

Sold the land for $6,100.

9.

Recognized $350 of accrued interest revenue .

10.

Took a physical count indicating that $4,400 of inventory was on hand at the end of the accounting period.

b.

Record the events in general journal format.

Events

General Journal

Debit

Credit

1a.

1b.

2.

3a.

3b.

4a.

4b.

5a.

5b.

6.

7a.

7b.

8.

9.

10.

rev

c.

Post the beginning balances and the events to the T-accounts. (Record the transactions in the given order. Leave no cells blank – be certain to enter “0” wherever required.)

Cash

Bal.

Bal.

Merchandise Inventory

Bal.

Bal.

Bal.

Accounts Receivable

Bal.

Interest Receivable

Bal.

Land

Bal.

Bal.

Accounts Payable

Bal.

Common Stock

Bal.

Retained Earnings

Bal.

cl

cl

Bal.

Sales Revenue

Bal.

cl

Bal.

Cost of Goods Sold

Bal.

cl

Bal.

Transportation-out

Bal.

cl

Bal.

Interest Revenue

cl.

Bal.

Gain on Sale of Land

cl.

Bal.

: 10_01_2012

d.

Prepare a multistep income statement, statement of changes in stockholders’ equity, balance sheet, and statement of cash flows(Amounts to be deducted and losses should be indicated with a minus sign. Leave no cells blank – be certain to enter “0” wherever required. Be sure to list the assets in order of their liquidity.)

P & D ENTERPRISES
Income Statement

For the Year Ended December 31, 2013

$

Operating expenses

$

Nonoperating items

$

P & D ENTERPRISES
Statement of Changes in Stockholders’ Equity
For the Year 2013

$

$

$

Total stockholders’ equity

$

P & D ENTERPRISES
Balance Sheet
As of December 31, 2013

Assets

$

Total assets

$

Liabilities

$

Stockholders’ equity

$

Total stockholders’ equity

$

Total liabilities and stockholders’ equity

$

P & D ENTERPRISES
Statement of Cash Flows
For the Year Ended December 31, 2013

Cash flows from operating activities:

$

Net cash flow from operating activities

$

Cash flows from investing activities

Cash flows from financing activities

Ending cash balance

$

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