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PRACTICE PROBLEMS #15

The following transactions for the Hollis Corporation occurred during September, 2010.

Transaction #1 : 9/1/10Receive $1,548.75K on previous account sales.

Transaction #2 : 9/3/10Purchase $5,691K of inventory. 20% cash. 80% on account.

Transaction #3 : 9/5/10Pay salaries and wages of $1,844K for worked performed in August.

Transaction #4 : 9/6/10Sell inventory for $8,132.30K. Cash.

Transaction #5 : 9/6/10Inventory sold in Transaction #4 cost $3,694.85K.

Transaction #6 : 9/9/10Recognize and pay SG&A expenses of $913.25K.

Transaction #7 : 9/12/10Deliver 43% of special order from 8/14/10 to customer. On that date, received $2,284Kadvance with estimated cost of inventory of $1,033K.

Transaction #8 : 9/12/10Recognize 43% of cost of inventory for special order from Transaction #7.

Transaction #9 : 9/15/10Pay $3,625.50K on previous account purchases.

Transaction #10 : 9/16/10Pay preferred dividends of $2.00 per share on 400K shares.

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Transaction #11 : 9/16/10Pay common dividends of $0.42 per share on 1,625K shares.

Transaction #12 : 9/18/10Sell inventory for $4,827.40K. On account.

Transaction #13 : 9/18/10Inventory sold in Transaction #12 cost $2,196.35K.

Transaction #14 : 9/20/10Recognize SG&A expenses of $724.81K.

Transaction #15 : 9/21/10Recognize September rent of $1,250K that was prepaid on 5/21/10.

Transaction #16 : 9/21/10Prepay rent of $1,275K per month for October, November, December, and January.

Transaction #17 : 9/23/10Receive $3,967.80K on previous account sales.

Transaction #18 : 9/27/10Receive $2,463.15K advance for special order to be delivered on 10/16/10. Estimated costof inventory is $1,700K.

Transaction #19 : 9/28/10Pay SG&A expenses of $724.81 that were recognized in Transaction #14.

Transaction #20 : 9/28/10Recognize salaries and wages of $1,912.70K for worked performed in September.

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P15-1.

Show that each transaction satisfies the balance sheet equation A= L+ OE.If there is an entry to Retained Earnings, include the income statement subaccount.

A L OE

Transaction #1

Transaction #2

Transaction #3

Transaction #4

Transaction #5

Transaction #6

Transaction #7

Transaction #8

Transaction #9

Transaction #10

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A L OE

Transaction #11

Transaction #12

Transaction #13

Transaction #14

Transaction #15

Transaction #16

Transaction #17

Transaction #18

Transaction #19

Transaction #20