Wilburton Riding Stables provides stables care for animals

and grounds #2310

Wilburton Riding Stables provides stables care for animals and grounds

Wilburton Riding Stables provides stables, care for animals, and grounds for riding and showing
horses. The account balances at the beginning of 2019 were:

During 2019, the following transactions occurred:

a. Wilburton provided animal care services, all on credit, for $210,300. Wilburton rented stables
to customers for $20,500 cash. Wilburton rented its grounds to individual riders, groups, and
show organizations for $41,800 cash.

b. There remains $15,600 of accounts receivable to be collected at December 31, 2019.

c. Feed in the amount of $62,900 was purchased on credit and debited to the supplies account.

d. Straw was purchased for $7,400 cash and debited to the supplies account.

e. Wages payable at the beginning of 2019 were paid early in 2019. Wages were earned and
paid during 2019 in the amount of $112,000.

f. The income taxes payable at the beginning of 2019 were paid early in 2019.

g. Payments of $73,000 were made to creditors for supplies previously purchased on credit.

h. One year's interest at 9% was paid on the note payable on July 1, 2019.

i. During 2019, Jon Wilburton, a principal stockholder, purchased a horse for his wife, Jennifer,
to ride. The horse cost $7,000, and Wilburton used his personal credit to purchase it.

The horse is stabled at the Wilburtons' home rather than at the riding stables.

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 j. Property taxes were paid on the land and buildings in the amount of $17,000.

k. Dividends were declared and paid in the amount of $7,200.

The following data are available for adjusting entries:

• Supplies (feed and straw) in the amount of $30,400 remained unused at year end.

• Annual depreciation on the buildings is $6,000.

• Annual depreciation on the equipment is $5,500.

• Wages of $4,000 were unrecorded and unpaid at year end.

• Interest for 6 months at 9% per year on the note is unpaid and unrecorded at year end.

• Income taxes of $16,500 were unpaid and unrecorded at year end.

Required:

1. Post the 2019 beginning balances to T-accounts. Prepare journal entries for Transactions a
through k and post the journal entries to T-accounts, adding any new T-accounts you need.

2. Prepare the adjustments and post the adjustments to the T-accounts, adding any new

T-accounts you need.

3. Prepare an income statement.

4. Prepare a retained earnings statement.

5. Prepare a classified balance sheet.

6. Prepare closing entries.

7. Did you include Transaction i among Wilburton's 2019 journal entries? Why or why not?

Wilburton Riding Stables provides stables care for animals and grounds

ANSWER
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