Answer to Question #213144 in Accounting for zuby

Question

Bowling Corporation had the following transactions occur during February:

1.

Bowling purchased $450,000 in inventory on credit.

2.

Bowling received $13,000 in cash from customers for subscriptions that will not begin until the following month.

3.

Bowling signed a note from Midwest Bank for $67,000.

4.

Bowling sold all the inventory purchased in (a) above for $700,000 on account.

5.

Bowling paid employees $120,000 for services performed during January.

6.

Bowling purchased land for $56,000 in cash.

7.

Bowling received $650,000 in cash from customers paying off January’s accounts receivable.

8.

Bowling paid dividends to stockholders in the amount of $4,000.

9.

Bowling owes its employees $123,000 for work performed during February but not yet paid.

10.

Bowling paid $300,000 on its accounts payable.

11.

Bowling paid taxes in cash of $45,000.

Required:

4.6 End-of-Chapter Exercises 86

1.

Prepare journal entries for the above transactions

Answer 1

Solution:

The journal entries are as below: