The Star Theatre, Inc. is unique as it shows only triple features of sequential theme

Problem 3-7A

The Star Theatre, Inc. is unique as it shows only triple features of sequential theme movies. As at February 29, 2012, the Star’s general ledger showed Cash $15,660; Land $85,830; Buildings (concession stand, projection room, ticket booth, and screen) $77,740; Equipment $20,430; Accounts Payable $11,690; Mortgage Payable $125,710; Common Shares $40,740; and Retained Earnings $21,521. During the month of March, the following events and transactions occurred:

Mar.	2		Received three Harry Potter movies to be shown during the first three weeks of March. The film rental was $27,970. Of that amount, $10,910 was paid in cash and the remainder will be paid on March 10.
	2		Hired M. Brewer to operate concession stand. Brewer agrees to pay Star Theatre 15% of gross receipts, payable on the last day of each month, for the right to operate the concession stand.
	5		Ordered three Shrek movies, to be shown the last 10 days of March. The film rental cost is $290 per night.
	9		Received $16,710 from customers for admissions.
	12		Paid balance due on the Harry Potter movie rentals.
	13		Paid the accounts payable owing at the end of February.
	19		Paid advertising expenses, $930.
	20		Received $16,970 from customers for admissions.
	23		Received the Shrek movies and paid rental fee of $2,900 ($290 × 10 nights).
	25		Received $19,080 from customers for admissions.
	27		Paid salaries of $4,360.
	30		Received statement from M. Brewer, showing gross concession receipts of $8,900, and the balance due to Star Theatre of $1,335 for March. Brewer paid half of the balance due and will remit the remainder on April 5.
	30		Paid $2,000 of mortgage principal and $860 of interest on the mortgage.

 

Journalize the March transactions. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No entry required" for the account titles and enter 0 for the amounts.)

Using T accounts, enter the beginning balances in the ledger as at February 29 and post the March journal entries to the ledger. (Post entries in the order presented in the problem.)

Prepare a trial balance at March 31, 2012. (List assets in order of liquidity.)

 

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