The lake theater opened on april 1.all facilities were completed on march 31. During april,the following events and transactions occured.
Apr.2 paid film rental of $800 on first movie.
3 ordered two additional films at $1,000 each.
10 made $2,000 payment on mortgage and $1,000 for accounts payable due.
11 lake theater contracted with r.wynns company to operate the concession stand. Wynns is to pay 17% of gross concession receipts (payable monthly) for the right to operate the concession stand.
20 received one of the films ordered on april 3 and was billed $1,000.the film will be shown in april.
30 received statement from r.wynns showing gross concession receipts of $1,000 and the balance due to the lake theater of $170($1,000 × 17%) for april. Wynns paid one-half of the balance due and will remit the remainder on may 5.
Journalize the april transaction.
when a merchandiser sell
on account which journal entry is
needed to record the transaction
Account Receivable debited for that amount and Sale credited for the amount.
To journalize the April transactions for the Lake Theater, we need to record each event or transaction in the general journal. Here's how we can go through each transaction and journalize them:
1. April 2: Paid film rental of $800 on the first movie.
Debit: Film Rental Expense ($800)
Credit: Cash ($800)
2. April 3: Ordered two additional films at $1,000 each.
There is no immediate journal entry for this transaction since it's just an order. We will record the expenses related to these films when they are received later.
3. April 10: Made $2,000 payment on the mortgage and $1,000 for accounts payable due.
Debit: Mortgage Payable ($2,000)
Debit: Accounts Payable ($1,000)
Credit: Cash ($3,000)
4. April 11: Lake Theater contracted with R. Wynns Company to operate the concession stand. Wynns is to pay 17% of gross concession receipts (payable monthly) for the right to operate the concession stand.
There is no immediate journal entry for this transaction since it's a contract. We will record the concession receipts and related payments in future journal entries.
5. April 20: Received one of the films ordered on April 3 and was billed $1,000. The film will be shown in April.
Debit: Film Inventory ($1,000)
Credit: Accounts Payable ($1,000)
6. April 30: Received a statement from R. Wynns showing gross concession receipts of $1,000 and the balance due to the Lake Theater of $170 ($1,000 × 17%) for April. Wynns paid one-half of the balance due and will remit the remainder on May 5.
Debit: Accounts Receivable - R. Wynns ($170)
Credit: Concession Revenue ($1,000)
Credit: Accounts Receivable - R. Wynns ($170)
Debit: Cash ($85) - The half payment received
Credit: Accounts Receivable - R. Wynns ($85) - The remaining balance to be received
These journal entries will record the April transactions for the Lake Theater. Remember, it's always important to ensure accuracy and to consult with an accountant or financial professional for specific accounting guidance.