finance Tarkington Freight Service provides delivery of merchandise to retail grocery stores in the
Northeast. At the beginning of 2019, the following account balances were available:
Cash |$92,100|| Accumulated Depreciation (Equipment) |$580,000
Accounts Receivable| 361,500 ||Land |304,975
Supplies| 24,600 ||Accounts Payable |17,600
Prepaid Advertising |2,000 ||Wages Payable |30,200
Building| 2,190,000 ||Notes Payable (due in 2023)| 1,000,000
Accumulated Depreciation (Building) |280,000|| Common Stock |1,400,000
Equipment| 795,000 ||Retained Earnings, 12/31/2018| 462,375
During 2019 the following transactions occurred:
a. Tarkington performed deliveries for customers, all on credit, for $2,256,700. Tarkington
also made cash deliveries for$686,838.
b. There remains $286,172 of accounts receivable to be collected at December 31, 2019.
c. Tarkington purchased advertising of$138,100 during 2019 and debited the amount to prepaid advertising.
d. Supplies of $27,200 were purchased on credit and debited to the supplies account.
e. Accounts payable at the beginning of 2019 were paid early in 2019. There remains$5,600 of
accounts payable unpaid at year end.
f. Wages payable at the beginning of 2019 were paid early in 2019. Wages were earned and
paid during 2019 in the amount of $666,142.
g. During the year, Trish Hurd, a principal stockholder, purchased an automobile costing$42,000 for her personal use.
h. One-half year’s interest at 6% annual rate was paid on the note payable on July 1, 2019.
i. Property taxes were paid on the land and buildings in the amount of $170,000.
j. Dividends were declared and paid in the amount of$25,000.
The following data are available for adjusting entries:
- Supplies in the amount of $13,685 remained unused at year end.
- Annual depreciation on the warehouse building is$70,000.
- Annual depreciation on the warehouse equipment is $145,000.
- Wages of$60,558 were unrecorded and unpaid at year end.
- Interest for 6 months at 6% per year on the note is unpaid and unrecorded at year end.
- Advertising of $14,874 remained unused at the end of 2019.
- Income taxes of$482,549 related to 2019 are unpaid at year end.
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