No.

Date Accounts Debits Credits

(1) 4/1/2005 Dr. Cash (+A) 250,000
Cr. Common Stock (+SE) 25,000
Cr. Additional Paid-in Capital (+SE) 225,000

(2) 4/1/2005 Park's loan of $50,000 not recorded by Pathfinder because it is

a loan to Park personally, not to the business

(3) 4/2/2005 Dr. Legal Fee Expense (+E, -SE) 3,900

Cr. Cash (-A) 3,900

(4) 4/7/2005 Dr. Building (+A) 52,000

Dr. Land (+A) 103,000
Cr. Mortgage Payable (+L) 124,000
Cr. Cash (-A) 31,000

(5) 5/25/2005 Dr. Building (+A) 33,000

Cr. Cash (-A) 33,000

(6) 6/2/2005 Dr. Metal Detectors (+A) 120,000 (240 * 500)

Cr. Cash (-A) 120,000

(7) 6/30/2005 Dr. Inventory (+A) 2,000

Cr. Accounts Payable (+L) 2,000

(8) 6/30/2005 Dr. Software (+A) 2100

Cr. Cash (-A) 2100

(9) 6/30/2005 Dr. Prepaid Advertising (+A) 8,000

Cr. Cash (-A) 8,000

(10) 6/30/2005 Dr. Notes Receivable (+A) 5,000

Cr. Cash (-A) 5,000

(11) 6/30/2005 No entry for employment contracts: work must be performed

or cash paid before entry is recorded

(12) 6/30/2005 Dr. Retained Earnings (-SE) 2,500 (25,000 * 0.10)

Cr. Dividends Payable (+L) 2,500

(13) 7/31/2005 Dr. Accounts Payable (-L) 2,000 31,800

Cr. Cash (-A) 2,000

(14) 8/31/2005 Dr. Dividends Payable (-L) 2,500

Cr. Cash (-A) 2,500

(15) 12/1/2005 Dr. Cash (+A) 1,200

Cr. Unearned Rental Revenue (+L) 1,200

(16) 12/31/2005 Dr. Cash (+A) 120,100

Dr. Accounts Receivable (+A) 4,200
Cr. Rental Revenue (+R, +SE) 124,300

(17) 12/31/2005 Dr. Inventory (+A) 40,000

Cr. Cash (-A) 38,000
Cr. Accounts Payable (+L) 2,000
(18) 12/31/2005 Dr. Cash (+A) 35,000
Cr. Sales (+R, +SE) 35,000

(19) 12/31/2005 Dr. Cost of Goods Sold (+E, -SE) 30,000

Cr. Inventory (-A) 30,000

(20) 12/31/2005 Dr. Salaries and Wages Expense (+E, -SE) 82,000
Cr. Cash (-A) 82,000

(21) 12/31/2005 Dr. Interest Expense (+E, -SE) 4,900

Cr. Interest Payable (+L) 4,900

(22) 12/31/2005 Dr. Bldg. Depreciation Expense (+E, -SE) 1500 (52,000+33,000-10,000)/25 *1/2
Cr. Accumulated Depreciation (+XA, -A) 1500

(23) 12/31/2005 Dr. Met Det Depreciation Expense (+E, -SE) 30,000 (120,000/2) * 1/2
Cr. Accumulated Depreciation (+XA, -A) 30,000

(24) 12/31/2005 Dr. Software Amortization (+E, -SE) 350

Cr. Software (-A) 350

(25) 12/31/2005 Dr. Advertising Expense (+E, -SE) 4,000

Cr. Prepaid Advertising (-A) 4,000

(26) 12/31/2005 Dr. Interest Receivable (+A) 250

Cr. Interest Revenue (+R, +SE) 250

(27) 12/31/2005 Dr. Unearned Rental Revenue (-L) 100

Cr. Rental Revenue (+R, +SE) 100

(28) 12/31/2005 Dr. Income Tax Expense (+E, -SE) 630

Cr. Income Taxes Payable (+L) 630

(C1) 12/31/2012 Dr. Sales (-R, -SE) 35,000

Dr. Rental Revenue (-R, -SE) 124,400
Dr. Interest Revenue (-R, -SE) 250
Cr. Retained Earnings (+SE) 159,650

(C2) 12/31/2012 Dr. Retained Earnings (-SE) 157,280

Cr. Cost of Goods Sold (-E, +SE) 30,000
Cr. Salaries and Wages Expense (-E, +SE) 82,000
Cr. Legal Fee Expense (-E, +SE) 3,900
Cr. Advertising Expense (-E, +SE) 4,000
Cr. Bldg. Depreciation Expense (-E, +SE) 1,500
Cr. Met Det Depreciation Expense (-E, +SE) 30,000
Cr. Software Amortization (-E, +SE) 350
Cr. Interest Expense (-E, +SE) 4,900
Cr. Income Tax Expense (-E, +SE) 630
 Cash (A) Land (A) Dividends Payable (L)
(1) 250,000 3,900 (3) (4) 103,000 (14) 2,500 2,500 (12)
(15) 1,200 31,000 (4)
(16) 120,100 33,000 (5) 103,000 0
(18) 35,000 120,000 (6)
2100 (8) Buildings (A) Income Taxes Payable (L)
8,000 (9) (4) 52,000 630 (28)
5,000 (10) (5) 33,000
2,000 (13) 85,000 630
2,500 (14)
38,000 (17) Metal Detectors (A) Unearned Rental Revenue (L)
82,000 (20) (6) 120,000 (27) 100 1,200 (15)

78,800 120,000 1,100

Accounts Receivable (A) Acm. Depreciation (XA) Mortgage Payable (L)

(16) 4,200 1,500 (22) 124,000 (4)
30,000 (23)
4,200 31,500 124,000

Notes Receivable (A) Software (A) Common Stock (SE)

(10) 5,000 (8) 2,100 25,000 (1)
350 (24)
5,000 1,750 25,000

Interest Receivable (A) Accounts Payable (L) Additional Paid-in-Capital (SE)

(26) 250 (13) 2,000 2,000 (7) 225,000 (1)
2,000 (17)
250 2,000 225,000

Inventory (A) Interest Payable (L) Retained Earnings (SE)

(7) 2,000 30,000 (19) 4,900 (21) (12) 2,500 159,650 (C1)
(17) 40,000 (C2) 157,280
12,000 4,900 130

Prepaid Advertising (A)

(9) 8,000 4,000 (25)

4,000

Sales (R) Legal Fee Exp. (E) Interest Expense (E)

35,000 (18) (3) 3,900 (21) 4,900

35,000 3,900 4,900

(C1) 35,000 3,900 (C2) 4,900 (C2)
0 0 0

Rental Revenue (R) Advertising Exp. (E) Income Tax Exp. (E)
124,300 (16) (25) 4,000 (28) 630
100 (27)
124,400 4,000 630
(C1) 124,400 4,000 (C2) 630 (C2)
0 0 0

Interest Revenue (R) Bldg. Depreciation Exp. (E)

250 (26) (22) 1,500

250 1,500
(C1) 250 1,500 (C2)
0 0

Cost of Goods Sold (E) Met Det Depreciation Exp. (E)

(19) 30,000 (23) 30,000

30,000 30,000
30,000 (C2) 30,000 (C2)
0 0

Salary& Wages Exp. (E) Software Amortization (E)

(20) 82,000 (24) 350

82,000 350
82,000 (C2) 350 (C2)
0 0
Relic Spotter Inc.
Trial Balances
December 31, 2012
Unadjusted Balances Adjustments Adjusted Balances Closing Entries Post-Closing Balances
Debit Credit Debit Credit Debit Credit Debit Credit Debit Credit
Cash 78,800 78,800 78,800
Accounts Receivable 4,200 4,200 4,200
Notes Receivable 5,000 5,000 5,000
Interest Receivable - 250 250 250
Inventory 12,000 12,000 12,000
Prepaid Advertising 8,000 4,000 4,000 4,000
Land 103,000 103,000 103,000
Buildings 85,000 85,000 85,000
Metal Detectors 120,000 120,000 120,000
Accumulated Depreciation - 31,500 31,500 31,500
Software 2,100 350 1,750 1,750

Accounts Payable 2,000 2,000 2,000

Interest Payable - 4,900 4,900 4,900
Dividends Payable - - -
Income Taxes Payable - 630 630 630
Unearned Rental Revenue 1,200 100 1,100 1,100
Mortgage Payable 124,000 124,000 124,000
Common Stock 25,000 25,000 25,000
Additional Paid-in-Capital 225,000 225,000 225,000
Retained Earnings 2,500 2,500 2,370 130

Rental Revenue 124,300 100 124,400 124,400 -

Sales 35,000 35,000 35,000 -
Interest Revenue - 250 250 250 -

Cost of Goods Sold 30,000 30,000 30,000 -

Salaries and Wages Expense 82,000 82,000 82,000 -
Legal Fees Expense 3,900 3,900 3,900 -
Advertising Expense - 4,000 4,000 4,000 -
Bldg. Depreciation Exp. - 1500 1,500 1,500 -
Met Det Depreciation Exp. - 30,000 30,000 30,000 -
Software Amortization - 350 350 350 -
Interest Expense - 4,900 4,900 4,900 -
Income Tax Expense - 630 630 630 -
536,500 536,500 41,730 41,730 573,780 573,780 159,650 159,650 414,130 414,130
 Income Statement

Relic Spotter Inc.

Income Statement
For the Year Ended December 31, 2012

Revenues:
Rental Revenue $ 124,400
Sales $ 35,000
Total Revenue $ 159,400

Cost of Revenues:
Met Det Depreciation Exp. $ (30,000)
Software Amortization $ (350)
Cost of Goods Sold $ (30,000)
Total Costs of Revenue $ (60,350)
Gross Profit $ 99,050

Selling, General, and Administative Expenses:

Salaries and Wages $ (82,000)
Legal Fees $ (3,900)
Advertising $ (4,000)
Bldg. Depreciation $ (1,500)
Total SG&A Expenses $ (91,400)
Operating Income $ 7,650

Interest Revenue $ 250

Interest Expense $ (4,900)
Pre-tax income $ 3,000

Income Tax Expense $ (630)

Net Income $ 2,370

Page 5
 Balance Sheet

Relic Spotter Inc.

Balance Sheet
December 31, 2012

Assets
Cash $ 78,800
Accounts Receivable $ 4,200
Notes Receivable $ 5,000
Interest Receivable $ 250
Inventory $ 12,000
Prepaid Advertising $ 4,000
Total Current Assets $ 104,250

Land $ 103,000
Buildings $ 85,000
Metal Detectors $ 120,000
Less Accumulated Depreciation $ (31,500)
Net Property, Plant, & Equipment $ 276,500

Software $ 1,750

Total Assets $ 382,500

Liabilities and Shareholders' Equity

Accounts Payable $ 2,000
Interest Payable $ 4,900
Income Taxes Payable $ 630
Unearned Rental Revenue $ 1,100
Total Current Liabilities $ 8,630

Mortgage Payable $ 124,000

Total Liabilities $ 132,630

Common Stock $ 25,000

Additional Paid-in-Capital $ 225,000
Retained Earnings $ (130)
Total Shareholders' Equity $ 249,870

Total Liabilities and Shareholders' Equity $ 382,500

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