70.2K

Verified Solution

Link Copied!

B&L Landscapes, Inc. Mini Practice Part 2

Bill Graham and Larry Miller incorporated B&L Landscapes, Inc. on July 1, 2014. The business consists of lawn care and sprinkler system installations. In addition, they also sell two types of fertilizer.

Bill and Larry are concerned about ensuring a steady supply of high-quality PVC pipe for the sprinkler installations jobs they do and have come up with a plan to issue bonds to several of their family members. These funds will enable them to acquire a significant portion of the stock of a local PVC manufacturer.

At the end of July, 2015, the company has the following adjusted trial balance:

B&L Landscapes, Inc.
Adjusted Trial Balance
July 31, 2015
Cash	$ 47,750
Accounts Receivable	11,500
Allowance for Doubtful Accounts			400
Prepaid Insurance	1,700
Inventory	79,000
Land	9,000
Building	35,000
Accumulated Depreciation - Building			1,750
Equipment	42,500
Accumulated Depreciation - Equipment			3,500
Accounts Payable			11,500
Notes Payable			45,000
Preferred Stock			7,000
Common Stock			40,000
Retained Earnings			117,300
Total	$226,450		$226,450

Not included in the adjusted trial balance are the following transactions that occur on July 31, 2015.

B&L Landscapes, Inc. issued $50,000 worth of 5%, 10 year bonds at face value.

B&L Landscapes, Inc. purchased 30% of the outstanding common stock of Crestline Pipe, Inc. for $70,000

Instructions:

Using the chart of accounts provided below, and the Excel template provided with this assignment, prepare journal entries, in good form, to record the issuance of bonds and the investment transactions. Start with Page 3 of the General Journal. Explanations are optional. Round all journal entries to two decimal places.

Post the entries to the general ledger provided. You only need to create ledgers for the accounts in Part 1. Record any existing account balances as beginning balances using the values from the adjusted trial balance.

Prepare a classified balance sheet for B&L Landscapes, Inc. for July 31, 2015.

On December 15, 2015, Crestline Pipe, Inc. pays a $5,000 dividend. Prepare the journal entry, in good form, to record B&Ls receipt of their share of the dividend. Record this

on Page 4 of the General Journal. Explanations are optional.

Crestline Pipe, Inc. reports total net income of $21,500 for the year ending December 31, 2015.

Record the necessary adjusting journal entries for B&L Landscapes, Inc. investments and bonds on Page 5 of the General Journal. Explanations are optional.

B&L LANDSCAPES, INC.

CHART OF ACCOUNTS

ASSETS REVENUES

101 Cash 401 Lawn Service Revenue

110 Accounts Receivable 410 Sales Revenue

112 Allowance for Doubtful Accounts 415 Sales Returns and Allowances

115 Notes Receivable 420 Interest Income

116 Interest Receivable 450 Revenue from Stock Investments

120 Supplies

130 Prepaid Insurance COST OF GOODS SOLD

140 Inventory 501 Purchases

145 Stock Investments 505 Purchase Returns and Allowances

150 Land

152 Building EXPENSES

153 Equipment 620 Supplies Expense

155 Accumulated Depreciation Building 630 Fuel Expense

156 Accumulated Depreciation Equipment 640 Repair and Maintenance Expense 650 Advertising Expense

LIABILITIES 655 Organization Expense

201 Accounts Payable 660 Insurance Expense

220 Notes Payable 670 Depreciation Expense

225 Interest Payable 680 Interest Expense

250 Bonds Payable 690 Bad Debt Expense

280 Dividends Payable

OWNERS EQUITY

301 Common Stock

310 Preferred Stock

330 Cash Dividends

350 Retained Earnings

Please answer for below charts

GENERAL JOURNAL Page P05 REF DATE DESCRIPTION DEBIT CREDIT B&L LANDSCAPES, INC. CHART OF ACCOUNTS ASSETS REVENUES 101 Cash 110 Accounts Receivable 112 Allowance for Doubtful Accounts 115 Notes Receivable 116 Interest Receivable 120 Supplies 130 Prepaid Insurance 140 Inventory 145 Stock Investment 401 Lawn Service Revenue 410 Sales Revenue 415 Sales Returns and Allowances 420 Interest Income 450 Revenue from Stock Investments COST OF GOODS SOLD 501 Purchases 505 Purchase Returns and Allowances GENERAL JOURNAL Page POST REF DESCRIPTION DEBIT CREDIT 150 Land 152 Building 153 Equipment 155 Accumulated Depreciation - Building 156 Accumulated Depreciation - Equipment DATE EXPENSES 620 Supplies Expense 630 Fuel Expense 640 Repair and Maintenance Expense 650 Adverfising Expense 655 Organization Expense 660 Insurance Expense 670 Depreciation Expense 680 Interest Expense 690 Bad Debt Expense LIABILITIES 201 Accounts Payable 220 Notes Payable 225 Interest Payable 250 Bonds Payable 280 Dividends Payable GENERAL JOURNAL Page DATE DESCRIPTION DEBIT CREDIT REF OWNER'S EQUITY 301 Common Stock 310 Preferred Stock 330 Cash Dividends 350 Retained Earnings

Answer & Explanation Solved by verified expert

See Answer