Journal Entries Flashcards
Establish allowance for doubtful accounts and write-off account.
Establish:
Dr. Bad debt expense
Cr. Allowance for doubtful accounts
Write off:
Dr. Allowance for doubtful accounts
Cr. Accounts receivable
Sell an asset for a loss and sell an asset for a gain.
Loss: Dr. Accumulated depreciation Dr. Loss Dr. Cash Cr. Equipment (at book value) Gain: Dr. Accumulated depreciation Dr. Cash Cr. Equipment (at book value) Cr. Gain
Cash dividend declared and paid.
Declared: Dr. Dividends Cr. Dividends payable Paid: Dr. Dividends payable Cr. Cash
Closing revenue, expense, and dividend entries.
Close revenue: Dr. Revenue Cr. Income summary Close expense accounts: Dr. Income summary Cr. Each expense account Close income summary to retained earnings: Dr. Income summary Cr. Retained earnings Close dividends: Dr. Retained earnings Cr. Dividends
Collect on accounts receivable.
Collect on A/R:
Dr. Cash
Cr. Accounts receivable
Purchase asset with cash and note payable.
To record purchase:
Dr: Land/Equipment
Cr. Cash
Cr. Note payable
Record annual depreciation expense.
Record annual depreciation expense:
Dr. Depreciation expense
Cr. Accumulated depreciation.
Record receipt of dividend income.
Receive dividend income:
Dr. Cash
Cr. Dividend income
Record accrued expense.
Record accrued expense:
Dr. Expense
Cr. Payable
Purchase and yearly adjustment of available for sale securities.
Purchase: Dr. Available for sale securities Cr. Cash Record loss at year end: Dr. Unrealized loss - OCI Cr. Available for sale securities Record gain at year end: Dr: Available for sale securities Cr. Unrealized gain - OCI
Investment in bonds at a discount, interest received, and redemption of bonds.
(Assume: five $1000, 5%, 3-year bonds at 97, semi-annual interest, straight-line)
Investment: Dr: Investment in bonds 4,850 Cr: Cash 4,850 Interest received: Dr: Cash 125 Dr: Investment in bonds 25 Cr: Interest income 150 (5,000 x .05 x 6/12 months) ($150 x 6 months / 36 months) Redemption: Dr: Cash 5,000 Cr: Investment in bonds 5,000
Investment in bonds at a premium, interest received, and redemption of bonds.
(Assume: five $1000, 5%, 3-year bonds at 106, semi-annual interest, straight-line)
Investment: Dr: Investment in bonds 5,300 Cr: Cash 5,300 Interest received: Dr: Cash 125 Cr: Investment in bonds 50 Cr: Interest income 75 ($5,000 x .05 x 6/12 months) ($300 x 6 months / 36 months) Redemption Dr: Cash 5000 Cr: Investment in bonds 5,000
Equity method investment purchase, net income, and dividends (Assume 25% stake, $10,000 net income and $1,000 in dividends)
Initial investment: Dr: Investment in investee Cr: Cash Year-end share of net income Dr: Investment in investee 2,500 Cr: Investment income 2,500 Share of dividends: Dr: Cash 1,000 Cr: Investment in investee 1,000
Investment in trading securities and year-end adjustments
Initial purchase: Dr: Trading securities Cr: Cash Year-end loss: Dr: Unrealized loss on investment (to net income) Cr: Trading securities Year-end gain: Dr: Trading securities Cr: Unrealized gain on investments (to net income)
Issue par value stock
3,000 shares, $1 par, at $5 per share
Issue:
Dr: Cash 15,000,000
Cr: Common stock 3,000,000
Cr: Additional paid-in capital 12,000,000
To record purchase of direct materials and job costing, including direct labor and overhead.
To record purchase: Dr: Raw materials inventory Cr: Accounts payable To transfer raw materials to productions: Dr: WIP inventory Cr: Raw materials inventory Cr: Salaries payable Cr: Overhead To transfer completed units to inventory: Dr: Finished goods inventory Cr: WIP inventory
To record loan payable, interest accrual, and repayment.
Assume $100,000 at 6% per year, principal and interest due end of year 2
To record receipt: Dr: Cash 100,000 Cr: Loan payable 100,000 To record accrued interest: Dr: Interest expense 3,000 Cr: Interest payable 3,000 To record repayment: Dr: Interest expense 6,000 Dr: Interest payable 3,000 Cr: Cash 109,000
To pay accounts payable
To pay accounts payable:
Dr: Accounts payable
Cr: Cash
To record payroll
To record payroll: Dr: Salaries Expense Cr: Federal income tax payable Cr: State income tax payable Cr: Social security payable Cr: Medicare payable Cr: Cash To record employer portion: Dr: Payroll tax expense Cr: Social Security payable Cr: Medicare payable Cr: FUTA payable Cr: SUTA payable
Record purchase and sale of inventory in perpetual environment.
Record purchase: Dr: Inventory Cr: Accounts payable Record sale: Dr: Accounts Receivable Dr: Cost of goods sold Cr: Inventory Cr: Sales
To record purchases and purchase returns
To record purchased inventory on account:
Dr: Purchases
Cr: Accounts payable
To record return of defective inventory to vendor:
Dr: Accounts payable
Cr: Purchase returns & allowances
To record prepaids
To record prepayment (example rent): Dr: Prepaid rent Cr: Cash To record adjustment (example rent): Dr: Rent expense Cr: Prepaid rent
To account for warranties
To record sale: Dr: Cash Cr: Sales To record expense accrual: Dr: Warranty expense Cr: Warranty liability To record warranty repair: Dr: Warranty liability Cr: Cash
Unearned revenue and adjustments
To record unearned revenue: Dr: Cash Cr: Unearned revenue To reflect earned revenue: Dr: Unearned revenue Cr: Revenue
To record large stock dividend issuance (50% stock dividend)
1,000,000 assumed shares outstanding x 50% x $1 par
Record issuance:
Dr: Retained earnings 500,000
Cr: Common stock 500,000
To record small stock dividend (5% stock dividend, 2,300,000 x 5% x $5 per share market price, $1 par value)
Record issuance:
Dr: Retained earnings 575,000
Cr: Common stock 115,000
Cr: Paid in capital in excess of par 460,000
