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Bisbee Mountain Company Trial Balance 11/30/17 Cr 172,000 124,000 Cash Accounts Receivable Allowance for Doubtful Accounts Short Term Note Receivable Supplies Inventory Equipment Building Accumulated Depreciation right Accounts Payable Dividends Payable Interest Payable Unearned Revenue ST Note Payable LT Mortgage Payable Bonds Payable Premium on Bonds Payable Common Stock - $1.25 par Paid In Capital In Excess of Par- CS Preferred Stock - $5 par Paid In Capital In Excess of Par - PS Treasury Stock Retained Earnings Dividends 1,000 50,000 55,000 62,000 75,000 32,000 94,000 12,000 0 0 24,000 22,500 300,000 26,840 105,000 86,000 1,000 50,000 0 3,500 2,000 390,160 Sales Revenue Sales Returns & Allowances Sales Discounts Cost of Goods Sold Bad Debts Expense Depreciation Expense Wages Expense Rent Expense Insurance Expense Supplies Expense Interest Revenue Interest Expense Gain on Sale of Equipment Income Tax Expense 7,000 3,000 46,000 5,000 16,000 167,500 98,000 25,000 16,000 1,000 6,500 15,000 46,000 1,070,000 1,070,000 Total Instructions: You must turn in the work performed on the sheets printed with this page. This WILL NOT BE ACCEPTED ON PLAIN PAPER Write the journal entries (on the following General Journal page) required for each of the events described below. Write the entries in the order described below (#1 - # 8 ) . Use ONLY the accounts listed on the trial balance for your journal entries. Post the transactions to individual T-accounts and prepare an adjusted trial balance for your assigned company from page one as of December 31, 2017. 1. The company purchased a building December 1, 2017 with a LT Mortgage Payable of $300,000 at 8% interest. (Record the purchase of the building.) 2. The company issued 1,000 shares of Common Stock for $6,000 on December 25, 2017. 3. On December 29, 2017 the company declared a cash dividend of $3.00 per share for common stock on the shares issued and declared (including the additional 1,000 shares issued on December 25.) 4. The terms of the LT mortgage payable from # 1 above require the company to make monthly installment payments over the term of the loan. Each payment consists of interest on the unpaid balance of the loan and a reduction of loan principal. Record the first monthly payment of $3,800 on the LT Mortgage Payable on December 31, 2017. 5. The company last paid interest on the ST note payable on November 1, 2017. Record the accrued interest expense for the last 2 months of 2017. The annual interest rate is 8%. Round to nearest whole dollar. 6. The Bonds Payable and related Premium amounts on the Nov. trial balance relate to the Jan. 1, 2017 issuance of the following bonds: On Jan. 1, 2017, the company issued 10 % , 10- year bonds when the market rate for similar investments was 89%. The company pays interest each year on January 1. On Dec. 31, 2017, use the effective interest method of amortizing the premium on bonds payable to accrue the interest expense for 2017. Round your interest expense calculation to the nearest whole dollar 7. The Unearned Revenue amount on the Nov. trial balance relates to amounts that the company previously collected in cash for sales that were to be completed in the future. The company completed some of these sales during December and now owes only $10,000 of that unearned revenue. Record the necessary adjustment for December 31, 2017. 8. On December 31, 2017, the company purchased 50 shares of its own Preferred Stock for Treasury Stock for $11 per share. YOU MUST INCLUDE ALL PAGES OF THIS DOCUMENT IN YOUR ASSIGNMENT SUBMISSION SUBMIT AS ONE PDF DOCUMENT 1) DATE 12/1/17 CREDIT ACCOUNT NAME Building Long-Term mortgage GENERAL JOURNAL DEBIT 300,000 payable 300,000 2) 12/25/17 .000 Cash Common Stock Paid in Capital in excess of 1,250 4,750 Par-CS 3) 12/29/17 Dividends Dividends Payable 255.000 2.5.000 4 12/31/17 LT mortgage Payable Interest Expense Cash 1,800 2.000 3,800 5) 12/31/17 Interest Expense Interest Payable 300 300 6) 12/31/17 Interest Expense Premium De Bonds Payable - Cash 26, 147 3,853 30.000 712131/17 14,000 Unearned Revenue Sales Revenue 14,000 8) 12/31/17 Stock 550 Treasury Cash sso Supplemental Questions 1. What will be the balance in the Mortgage Payable Account at Jan. 31, 2018 after the second monthly payment is made? 2. The Company is about to issue $2,000,000 of 5-year, 12% bonds. Interest will be paid semi- annually. The market interest rate for such securities is 10%. How much can The Company expect to receive from the sale (issuance) of these bonds

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