70.2K

Verified Solution

Link Copied!

King Toot's CEO provides you with additional information to help you and your team prepare adjustments for April (assume that King Toot's has a monthly accounting period and prepares AJEs at the end of each month): - You perform a physical count of supplies and determine there are $525 of Supplies remaining on hand at the end of April. - The $16,200 of equipment that was purchased on 4/1 has an estimated five-year useful life and no salvage value. The firm uses the straight-line depreciation method. - Recall from last week's activity that on 4/15, a customer paid $920 in advance for 10 lessons (\$92 per lesson) which was all recorded as Deferred Revenue. As of 4/30, King Toot's had provided 3 of the lessons to the customer. - The $56,000 Note Payable that was signed on 4/1 is due in 10 years. Annual interest on the Note Payable is 7.5% and interest payments are made each year on March 31st. The first interest payment is due 3/31/2024. - King Toot's pays a total of $25,400 in wages every two weeks to employees (assume there are 10 work-days in each two week pay period, so wages are $2,540 each work day). Recall from last week's activity that the firm paid wages of $25,400 on 4/19. This payment was for work done during the two week pay period of 4/64/19. The next $25,400 payment for wages will be made on May 3, 2023, which includes 7 work-days related to April and 3 work-days related to May. PART III. Further Analysis - please answer the following questions: A. What is the Net Book Value (NBV) of the equipment as of 4/30/2023 ? B. What is the journal entry the firm would make on May 3rd when it makes the $25,400 cash payment to workers during the next accounting period? King Toot's CEO provides you with additional information to help you and your team prepare adjustments for April (assume that King Toot's has a monthly accounting period and prepares AJEs at the end of each month): - You perform a physical count of supplies and determine there are $525 of Supplies remaining on hand at the end of April. - The $16,200 of equipment that was purchased on 4/1 has an estimated five-year useful life and no salvage value. The firm uses the straight-line depreciation method. - Recall from last week's activity that on 4/15, a customer paid $920 in advance for 10 lessons (\$92 per lesson) which was all recorded as Deferred Revenue. As of 4/30, King Toot's had provided 3 of the lessons to the customer. - The $56,000 Note Payable that was signed on 4/1 is due in 10 years. Annual interest on the Note Payable is 7.5% and interest payments are made each year on March 31st. The first interest payment is due 3/31/2024. - King Toot's pays a total of $25,400 in wages every two weeks to employees (assume there are 10 work-days in each two week pay period, so wages are $2,540 each work day). Recall from last week's activity that the firm paid wages of $25,400 on 4/19. This payment was for work done during the two week pay period of 4/64/19. The next $25,400 payment for wages will be made on May 3, 2023, which includes 7 work-days related to April and 3 work-days related to May. PART III. Further Analysis - please answer the following questions: A. What is the Net Book Value (NBV) of the equipment as of 4/30/2023 ? B. What is the journal entry the firm would make on May 3rd when it makes the $25,400 cash payment to workers during the next accounting period

Answer & Explanation Solved by verified expert

See Answer