Larry Matt Completed These Transactions During December of the Current

question 130

Essay

Larry Matt completed these transactions during December of the current year:
$\begin{array} { | l | l | } \hline \text { Dec. 1 } & \begin{array} { l } \text { Began a financial services practice by investing } \$ 15,000 \text { cash and office } \\\text { equipment having a } \$ 5,000 \text { value. }\end{array} \\\hline 2 & \text { Purchased } \$ 1,200 \text { of office equipment on credit. } \\\hline 3 & \text { Purchased } \$ 300 \text { of office supplies on credit. } \\\hline\end{array}$
$\begin{array}{|l|l|}\hline 4 & \begin{array}{l}\text { Completed work for a client and immediately received a payment of } \$ 900 \\\text { cash. }\end{array} \\\hline 8 & \text { Completed work for Precept Paper Co. on credit, } \$ 1,700 . \\\hline 10 & \text { Paid for the supplies purchased on credit on December } 3 . \\\hline 14 & \text { Paid for the annual } \$ 960 \text { premium on an insurance policy. } \\\hline 18 & \begin{array}{l}\text { Received payment in full from Precept Paper Co. for the work completed on } \\\text { December } 8 .\end{array} \\\hline 27 & \text { Larry withdrew } \$ 650 \text { cash from the practice to pay personal expenses. } \\\hline 30 & \text { Paid } \$ 175 \text { cash for the December utility bills. } \\\hline 30 & \text { Received } \$ 2,000 \text { from a client for financial services to be rendered next year. } \\\hline\end{array}$
Prepare general journal entries to record these transactions.

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Definitions:

Variable Production Costs

Costs that vary directly with the level of production, such as materials, labor, and utilities needed for manufacturing.

Absorption Costing

An accounting method that includes all manufacturing costs (direct materials, direct labor, and both variable and fixed manufacturing overhead) in the cost of a product.

Unit Product Cost

The total cost (both fixed and variable) associated with producing a single unit of a product.

Unit Product Cost

The total cost involved in manufacturing or producing one unit of a product, including materials, labor, and overhead.