THIS IS A CONTINUATION OF ICC 2B. Hawking, Inc. had the following activities occur in the current year: 6. Purchased $189,000 of inventory on account.
7. Earned $536,000 worth of sales revenue, receiving 85% in cash.
8. Incurred selling expenses of $210,000, paying half in cash and still owing the rest.
9. Incurred $33,000 in interest expense to be paid at the beginning of next year.
Required
a) Show the effects of the above transactions on the accounting equation.
b) Prepare journal entries for each transaction.
c) Post journal entries to the general ledger/T-accounts, summarize accounts, and find balances.
d) Prepare an unadjusted trial balance.
e) Match your numbers to the prepared financial statements: Income Statement, Retained Earnings Statement, and Balance Sheet.