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(Solved): The Artisan Wines is a retail store selling vintage wines. On December 31, 20X1, the firms genera ...



The Artisan Wines is a retail store selling vintage wines. On December 31, 20X1, the firm’s general ledger contained the accounts and balances below. All account balances are normal.

Cash$25,911 Accounts Receivable 450 Prepaid Advertising 780 Supplies 250 Merchandise Inventory 14,500 Store Equipment 24,500 Accumulated Depreciation—Store Equipment 2,500 Office Equipment 4,500 Accumulated Depreciation—Office Equipment 1,250 Notes Payable, due 20X2 15,000 Accounts Payable 2,655 Wages Payable Social Security Tax Payable Medicare Tax Payable Unearned Seminar Fees 9,000 Interest Payable Vincent Carbone, Capital 32,200 Vincent Carbone, Drawing 13,610 Income Summary Sales 151,470 Sales Discounts 150 Seminar Fee Income Purchases 90,500 Purchases Returns and Allowances 1,500 Freight In 200 Rent Expense 12,700 Wages Expense 24,000 Payroll Taxes Expense 3,324 Depreciation Expense—Store Equipment Depreciation Expense—Office Equipment Advertising Expense Supplies Expense Interest Expense 200


ADJUSTMENTS:

a.–b. Merchandise inventory at December 31, 20X1, was counted and determined to be $11,500.

  1. The amount recorded as prepaid advertising represents $780 paid on September 1, 20X1, for 12 months of advertising.
  2. The amount of supplies on hand at December 31 was $75.
  3. Depreciation on store equipment was $3,000 for 20X1.
  4. Depreciation on office equipment was $875 for 20X1.
  5. Unearned Seminar Fees represent $9,000 received on November 1, 20X1, for six seminars. At December 31, four of these seminars had been conducted.
  6. Wages owed but not paid at December 31 were $500.
  7. On December 31, 20X1, the firm owed the employer’s social security tax ($31.00) and Medicare tax ($7.25).
  8. The note payable bears interest at 6 percent per annum. One months interest is owed at December 31, 20X1.


Required:

  1. Prepare the Trial Balance section of a 10-column worksheet. The worksheet covers the year ended December 31, 20X1.
  2. Enter the adjustments above in the Adjustments section of the worksheet.
  3. Complete the worksheet.


Analyze:
What was the amount of revenue earned by conducting seminars during the year ended December 31, 20X1?

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What was the amount of revenue earned by conducting seminars during the year ended December ? Revenue earned, Dec. 31, 20X1


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The calculation for the Adjustments section of the worksheet

Pre paid Advertising expense





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