The ledger accounts of the Seechua Company for the year ended December 31, 2020

are as follows:

Account Description Debit Credit

Cash 72,000
Accounts Receivable 136,000
Merchandise Inventory 598, 000
Prepaid Advertising 75,000
Office Supplies 42, 000
Land 400, 000
Office Equipment 570, 000
AD-Equipment 150, 000
Office Building 1,600, 000
AD-Office Building 100, 000
Accounts Payable 74, 000
Salaries Payable
Notes Payable 200, 000
Mortgage Payable 1,100, 000
Seechua, Capital 1,510, 000
Seechua, Withdrawals 200, 000
Sales 4,600,000
Sales ret and allow. 187, 000
Sales Discount 161, 000
Purchases 2,643, 000
Purchases Ret and allow 133,000
Purchase Discount 172, 000
Transportation in 72, 000
Salaries Exp 862, 000
Insurance Exp 25, 000
Travel Exp 188, 000
Interest Exp 208, 000
Office Supplies Exp
Advertising Exp
Dep’n Exp- office bldg
Dep’n Exp- Equipment
Totals 8,039,000 8,039,000
Additional Information:

a.) Office supplies consumed during the year amounted to 17,000

b.) Advertising expense in the amount of 25,000 has expired

c.) Salaries of 21,000 have accrued at December 31

d.) Depreciation on the building and equipment amounted to 15,000 and 20,000
respectively

e.) The December 31 merchandise inventory is 723,000

Answers:

a.) Office supplies Expense 17,000

Office Supplies 17,000

b.) Advertising Expense 25,000

Prepaid Advertising 25,000

c.) Salaries Expense 21,000

Salaries Payable 21,000

d.) Dep’n Exp- Office building 15,000

Dep’n Exp- Equipment 20,000

AD- Office Building 15,000

AD- Equipment 20,000

e.) Income Summary 598,000

Merchandise Inventory 598,000

Merchandise Inventory 723,000

Income Summary 723,000