Prepare the balance sheet

Comprehensive Problem. Heintz and Parry. College Accounting 19th Edition and 20th Edition.
The Generals Favorite Fishing Hole

PERIOD 2
The Generals Favorite Fishing Hole

Bob Nights fishing camp, The Generals
Favorite Fishing Hole, is in the second month of operation. The camp is
open from April through September, which allows for many college
basketball coaches to attend during their off-season. The camps
attendees arrive on Sunday afternoon and return home the following
Saturday afternoon. Each attendee pays a registration fee that includes
room and board, the use of fishing boats, and professional instruction
in fishing techniques. Based on suggestions from clients, Night plans to
expand the facilities and provide additional services. The post-closing
trial balance as of April 30, and chart of accounts are provided below.
The Generals Favorite Fishing Hole
The following transactions took place during May 20
The Generals Favorite Fishing Hole
May
1 In order to provide snacks for guests on a 24 hour basis, Night
signed a contract with Snack Attack. Snack Attack will install vending
machines with food and drinks and pay a 10% commission on all sales.
Estimated payments are made at the beginning of each month. Night
received a check for $200, the estimated commission on sales for May.
2 Night purchased a surround sound system and big screen TV with a
Digital Satellite System for the guest lounge. The surround sound system
cost $3,600 and has an estimated useful life of 5 years, and no salvage
value. The TV cost $8,000 and has an estimated useful life of 8 years,
and a salvage value of $800. Night paid cash for both items.
2 Paid for Mays programming on the new Digital Satellite System, $125.
3 Nights office manager returned $100 worth of office supplies to
Gordon Office Supply. Night received a $100 reduction in our account
with Gordon.
3 Deposited registration fees, $52,700
3 Paid rent for lodge and campgrounds for the month of May, $40,000.
3 In preparation for the purchase of a nearby campground, Night invested an additional $600,000.
4 Paid Gordon Office Supply on account, $400.
4 Purchased the assets of a competing business and paid cash for the
following: land $100,000, lodge $530,000 and fishing boats $9,000. The
lodge has a remaining useful life of 50 years and a $50,000 salvage
value. The boats have remaining lives of 5 years and zero salvage value.
5 Paid Mays insurance premium for the new camp, $1,000
5 Purchased food supplies from Acme Super Market on account, $22,950.
5 Purchased office supplies from Gordon Office Supplies on account, $1,200.
7 Night paid $40 each for one-year subscriptions to Fishing Illustrated, Fishing Unlimited, and Fish Master.
10 Deposited registration fees, $62,750
13 Paid wages to fishing guides, $30,000.
14 A guest because ill and was unable to stay for the entire week. A refund was issued in the amount of $1,000.
17 Deposited registration fees, $63,000.
19 Purchased food supplies from Acme Super Market on account, $18,400.
21 Deposited registration fees, $63,400
23 Paid $2,500 for advertising spots on National Sports Talk Radio
25 Paid repair fee for damaged boat, $ 850.
27 Paid wages to fishing guides, $30,000.
28 Paid $1,800 for advertising spots on billboards in the mid-west.
29 Purchased food supplies from Acme Super Market on account, $14,325.
30 Paid utilities bill, $3,300
30 Paid telephone bill, $1,800.
30 Paid Acme Super Market on account, $47,350.
31 Bob Night withdrew cash for personal use, $7,500.

Adjustment information at the end of May is provided below.
a. Total vending machine sales were $2,300 for the month of May.
b. Straight-line depreciation is used for the 10 boats purchased on
April 2nd for $60,000. The useful life for these assets is 5 years and
there is no salvage value. A full months depreciation was taken in
April on these boats.
c. Straight line depreciation is used for the 2 boats purchased in May.
d. Straight line depreciation is used to depreciate the surround sound system.
e. Straight line depreciation is used to depreciate the big screen TV.
f. Straight line depreciation is used for the building purchased in May.
g. On April 2nd Night paid $9,000 for insurance during the six-month
camping season. Mays portion of this premium was used up during this
month.
h. Night received his May issues of Fishing Illustrated, Fishing Unlimited, and Fish Master.
i. Office supplies remaining on hand, $150.
j. Food supplies remaining on hand, $5,925.
k. Wages earned, but not yet paid, at the end of May, $6,000.
The Generals Favorite Fishing Hole
REQUIRED
1. Enter the above transactions in a general journal. Enter
transactions from May 1-4 on page 5, May 5-28 on page 6, and the
remaining entries on page 7.
2. Post the entries to the general ledger. (If you are not using the
working papers that accompany this text, you will need to enter the
account titles and account numbers in the general ledger accounts.)
3. Prepare a trial balance on a work sheet.
4. Complete the work sheet.
5. Prepare the income statement.
6. Prepare the statement of owners equity
7. Prepare the balance sheet.
8. Journalize the adjusting entries on page 8 of the general journal.
9. Post the adjusting entries to the general ledger.
10. Journalize the closing entries on page 9 of the general journal.
11. Post the closing entries to the general ledger.
12. Prepare a post-closing trial balance.