Question

Journalize the following entries

27.  November 1:  After being advised by legal counsel and Mr. Smithers that killing off competition was considered murder, Mr. Burns decided to get a patent to keep from his secrets from being used by his rivals.  He paid $200,000 for his patent which will be amortized for 15 years.

28.  December 1:  Mr. Burns bought Cookie Dough and paid for the amount up front to get a bulk discount. The amount paid is $400,000

29.  December 8:  Mr. Burns bought office supplies on account from Staples for $50,000.

30.  December 9 Mr.  Burns sold $400,000 of cookies on account to Shelbyville.  The cost of sales was $200,000

31. December 25:  Mr. Burns paid a cash dividend after being visited by the three ghosts of Christmas to the Shareholder $400,000

32. December 31: Mr. Burns made interest payment on Bond #1.  Use effective interest method.  The payments are considered to be ordinary annuities

33.  December 31:  Mr. Burns made interest payment on Bond #2 Use effective interest method.  The payments are considered to be ordinary annuities

Answer 1

JOURNAL ENTRIES :

	Sl NO	Date	Accounts & Explanation	Debit	Credit
	27	1-Nov	Patent Account	200,000.00
			To Cash		200,000.00
	28	1-Dec	Purchase Account	400,000.00
			To Cash		400,000.00
	29	8-Dec	Office Supplies	50,000.00
			To Accounts Payable		50,000.00
	30	9-Dec	Cash	400,000.00
			To sales		400,000.00
		9-Dec	Cost of Goods sold	200,000.00
			To Inventory		200,000.00
	31	25-Dec	Retained Earnings	400,000.00
			To Divident payable		400,000.00
		25-Dec	Divident payable	400,000.00
			To Cash		400,000.00
	32	31-Dec	Bond interest expense (Amount not available in the question)	xx
			To Bond discount		xx
			To Cash		xx
	33	31-Dec	Bond interest expense (Amount not available in the question)	xx
			To Bond discount		xx
			To Cash		xx