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______s Nature Tours

COMPANY OPERATIONS
Sals Nature Tours, a sole proprietorship owned by Sally Swift, began operations on January 1, 2004 in Big City, Texas. Sals Nature Tours sells tours of the Gulf Coast Area to individuals and groups, taking people to such places as Armand Bayou, Galveston, High Island, the Katy Prairie, and other such places where people can observe different natural phenomena and wildlife. Sals Nature Tours has retained you to install the companys accounting system, to implement the system, to maintain the companys accounting records, and to produce monthly financial statements.
Sals Nature Tours CHART OF ACCOUNTS Account Number 101 105 106 110 120 123 125 126 130 131 200 205 210 215 220 300 301 305 400 510 514 516 518 520 525 530 535 540 545 550 999 Account Name Account type

Cash Cash Accounts Receivable Accounts receivable Allowance for Doubtful Accounts Accounts receivable Office Supplies Other current assets Prepaid Rent Other current assets Prepaid Insurance Other current assets Tour Vans Fixed assets Accumulated Depreciation Tour Vans Accumulated depreciation Office Equipment Fixed assets Accumulated Depreciation - Office EquipmentAccumulated depreciation Accounts Payable Accounts payable Salaries Payable Other current liabilities Interest Payable Other current liabilities Notes Payable Other current liabilities Unearned Tour Revenue Other current liabilities Common Stock Stock equity stays open Retained Earnings Stock equity ret earnings Dividends Stock equity-gets closed Tour Revenue Income Salaries Expense Expense Depreciation Expense Expense Rent Expense Expense Bad Debts Expense Expense Utilities Expense Expense Supplies Expense Expense Insurance Expense Expense Interest Expense Expense Bank Charges Expense Expense Transportation expense Expense Meal Expense Expense Income Summary Stock equity-gets closed

Spring 2004 HCC

Sals Nature Tours TRANSACTIONS for the month ending January 31, 2004 January 1 1 1 2 3 Sals Nature Tours sells $____________ worth of common stock for cash. Sals Nature Tours borrows $_____________ for one year at 12% from the SmallTown Bank. Sal hires a Tours clerk, Stella Roo, to help with tours and sales. Stella will be paid on the first and the fifteenth of each month. Stellas monthly salary equals $____________. Sals Nature Tours finds ideal rental space in the newest mall in town. The Tours pays $________ to Royal Realty for rent through June 30, 2004. Sals Tours buys $__________ of tour vans from Joes Incredibly Cheap Tour Vans, Inc. for cash. Sal estimates that the vans will be used for about _________ miles, at which time the vans will have a salvage value of about $_________. Vans are depreciated on a units of production basis. Sals Tours buys $_________of additional office supplies from Office Depot on account. Sals Nature Tours takes its first large group tour with All City Kids to Brazos Bend State Park for $__________. It receives $__________ in cash and the rest on account. Sals pre-sells another tour package to The Brady Bunch for $__________. Tours will be given for each of the next ___ months, with the first one to be given the last week in January. Sals takes another group tour, this time to Armand Bayou, with a group of rowdy college students. It charges each student $_______ cash and there are 30 students on the bus. Sals pays toll road fees of $________ and buys lunch for everyone at the Blue Oyster Bar for a total of $___________. Sals pays off its debt to Office Depot. Sals signs a contract with the Big City Lone Star Travelers. It will conduct a tour every month from February through June for $_________ each month. Sals Nature Tours pays Stella Roo. No taxes are withheld from her salary (Stella is on contract.) Sals Nature Tours prepays $___________ to Great American Insurance Company for a one-year insurance policy for liability and casualty coverage. Sals Tours buys $__________ of computers and other office equipment from Office Depot for $_________ cash and the balance on account. The equipment will have to be replaced after 5 years, at which time the equipment will have only a minimal value. Equipment is depreciated on a doubledeclining balance basis. The computers have to be installed by a specialist, who charges Sals $________. Sals Tours receives payment for the accounts receivable balance from All City Kids. Sals takes a short tour to the Houston Arboretum with a school group and charges $_____ per child. 30 children are included in the tour. The school will pay Sals in 30 days.

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Sals Nature Tours TRANSACTIONS 26 31 1 Additional information on January 31, 2004: do not attempt to enter this data until you have been oked!!! Dangerous! a] b] c] d] 1. e] f] g] h] i] There is $_____of office supplies on hand. Sally Swift estimates that 5% of Accounts Receivable will be uncollectible. The odometer reading on the vans at the end of January shows that they have been driven ________ miles. Stella Roo has earned month of salary but will not be paid for that period until February The office equipment is depreciated as if purchased at the beginning of the month. Use doubledeclining balance depreciation. One month of rent expense must be taken. One-half month of insurance expense must be taken. One month of interest expense on the note payable must be recorded. Part of the Unearned Tour Revenue has been earned. Sals Nature Tours receives a $_______ utility bill, due February 10, from Big City Lighting and Power Company. Sals Nature Tours receives its January bank statement that reconciled after identifying the $____ service charge for new checks.

THE SALS NATURE TOURS REQUIREMENTS


As the accountant for Sals Nature Tours, you must 1. 2. 3. record the January transactions in the general journal, prepare any necessary adjusting journal entries as of January 31, prepare any necessary closing journal entries as of January 31,

You will do this project in 3 parts, each to be turned in as assigned by your teacher.