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China Trade, Inc. Journal Entries: Date GL Number Description Debit Credit

The journal entries record various transactions of China Trade Inc. such as deposits from shareholders, purchases and sales of inventory, payment of expenses like rent and salaries, and the declaration of dividends. The entries show an increase in assets from purchases and a decrease from payments, resulting in total assets of $28,760 at the end of the period.

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480 views7 pages

China Trade, Inc. Journal Entries: Date GL Number Description Debit Credit

The journal entries record various transactions of China Trade Inc. such as deposits from shareholders, purchases and sales of inventory, payment of expenses like rent and salaries, and the declaration of dividends. The entries show an increase in assets from purchases and a decrease from payments, resulting in total assets of $28,760 at the end of the period.

Uploaded by

Jalaj Gupta
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
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China Trade, Inc.

Journal entries

Date GL Number Description Debit Credit


1-Aug 101 Cash in Bank 5,000.00
300 Common Stock 5,000.00
Mae Ling deposit

101 Cash in Bank 5,000.00


300 Common Stock 5,000.00
James Madison deposit

2-Aug 680 Rent Expense 1,000.00


101 Cash in Bank 1,000.00
paid one month's rent (office)

3-Aug 165 Automotive Equipment 15,000.00


101 Cash in Bank 4,000.00
285 Long-term note payable 11,000.00
Purchased van
First National Bank 12% 48 equal monthly installments

6-Aug 120 Inventory 12,000.00


200 Accounts Payable 12,000.00
20 units/$600 each. Net 30 Shaghai Export Co
Inv. 08-1234

17-Aug 110 Accounts Receivable 5,000.00


400 Sales 5,000.00
sold merchandise. 5 units COD
The Gift Gallery-Inv 10001

101 Cash in Bank 5,000.00


110 Accounts Receivable 5,000.00
received COD

500 Cost of Goods Sold 3,000.00


120 Inventory 3,000.00
to record COGS

18-Aug 110 Accounts Receivable 7,800.00


400 Sales 7,800.00
sold merchandise. 6 units Net 10
Vanity Faire-Inv 10002

500 Cost of Goods Sold 3,600.00


120 Inventory 3,600.00
to record COGS

28-Aug 160 Equipment 1,000.00


130 Prepaid Expenses& deposits 100.00
101 Cash in Bank 1,100.00
Purchased phone system
one month pre-paid service

605 Advertising 1,300.00


101 Cash in Bank 1,300.00
Direct mail advertising

695 Salaries and Wages 800.00


225 FICA & Medicare Withheld 60.00
220 Fed Income Tax Withheld 100.00
230 State Income Tax Withheld 30.00
235 State Disability Withheld 10.00
101 Cash in Bank 600.00
John J. Jones Wages
80 hours @$10

29-Aug 101 Cash in Bank 2,000.00


110 Accounts Receivable 2,000.00
Vanity Faire-chk 54321, inv. 10002

30-Aug 320 Dividends 500.00


101 Cash in Bank 500.00
$1/share divindends to Mae Ling

320 Dividends 500.00


101 Cash in Bank 500.00
$1/share divindends to James Madison

31-Aug 200 Accounts Payable 6,000.00


101 Cash in Bank 6,000.00
Shaghai Export Co, Inv. 08-1234

640 Depreciation 250.00


Automotive Equipment:
166 Accumulated Depreciation - Auto 250.00
to record Van depreciation for Aug. Straight line method. 5-year useful life. Salvage value=0

620 Bad Debt Expense 290.00


Accounts Receivable: Allowance
111 for doubtful accts 290.00
To record bad debt expense (5% of past due AR)

780 Income Tax Expense 640.00


260 Income Tax Payable 640.00
To record estimated Income Tax Expense. (25% of net income before taxes)
eful life. Salvage value=0
GL # GL Description 7/31/2013 Debit Credit 8/31/2013
Balance Balance
101 Cash in Bank - 17,000.00 15,000.00 2,000.00
110 Accounts receivable - 12,800.00 7,000.00 5,800.00
120 Inventory - 12,000.00 6,600.00 5,400.00
130 Prepaid Expenses & deposits - 100.00 - 100.00
160 Equipment - 1,000.00 - 1,000.00
165 Automotive Equipment - 15,000.00 - 15,000.00
200 Accounts payable - 6,000.00 12,000.00 (6,000.00)
220 Fed Income Tax Withheld - - 100.00 (100.00)
225 FICA & Medicare Withheld - - 60.00 (60.00)
230 State Income Tax Withheld - - 30.00 (30.00)
235 State Disability Withheld - - 10.00 (10.00)
250 Sales Tax Payable - - - -
260 Income Tax Payable - - 640.00 (640.00)
285 Long-term note payable - - 11,000.00 (11,000.00)
300 Common stock - - 10,000.00 (10,000.00)
320 Dividends - 1,000.00 - 1,000.00
340 Retained earnings - - - -
400 Sales - - 12,800.00 (12,800.00)
500 Cost of Goods Sold - 6,600.00 - 6,600.00
605 Advertising - 1,300.00 - 1,300.00
620 Bad Debt Expense - 290.00 - 290.00
640 Depreciation - 250.00 - 250.00
680 Rent Expense - 1,000.00 - 1,000.00
695 Salaries and Wages - 800.00 - 800.00
715 Telephone - - - -
780 Income Tax Expense - 640.00 - 640.00
China Trade, Inc.
Income Statement
Period from August 01 Through August 31, 2015

Current Month Year to Date


Revenues
Sales 12,800.00 12,800.00
Total Revenue 12,800.00 12,800.00

Cost of Sales
Cost of Goods Sold 6,600.00 6,600.00
Total Cost of Sales 6,600.00 6,600.00

Gross Profit 6,200.00 6,200.00

Expenses
Advertising 1,300.00 1,300.00
Office Rent 1,000.00 1,000.00
Salaries 800.00 800.00
Bad Debt Expense 290.00 290.00
Depreciation 250.00 250.00
Income Tax Expense 640.00 640.00
Total Expenses 4,280.00 4,280.00

Net Income 1,920.00 1,920.00


China Trade, Inc.
Balance Sheet
For the Period Ended on 31 Aug 2015

Current Assets
Cash in Bank 2,000.00
Accounts Receivable 5,800.00
AR: Allowance for doubtful accts (290.00)
Inventory 5,400.00
Deposits 100.00
Total Current Assets 13,010.00

Property, Plant, & Equipment


Office Equipment 1,000.00
Automotive 15,000.00
Depreciation (250.00)
Total PP&E 15,750.00

Total Assets 28,760.00

Current Liabilities
Income Tax Payable 640.00
Accounts Payable 6,000.00
Federal Inc. Tax Withheld 100.00
FICA & Medicare Withheld 60.00
State Inc. Tax Withheld 30.00
State Disability Withheld 10.00
Total Current Liabilities 6,840.00

Long Term Liabilities


Note Payable 11,000.00
Total Liabilities 17,840.00

Shareholders Equity
Common Stock 10,000.00
Dividends (1,000.00)
Retained Earnings 1,920.00
Total Equity 10,920.00

Total Liabilities & Equity 28,760.00

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