Case 1 — Pinetree Motel* Essay

1243 Words Dec 21st, 2015 5 Pages
Case 1 — Pinetree Motel* Mr. and Mrs. Yong Kim had purchased the Pinetree Motel in 2008 with their life savings, supplemented by a loan from a close personal friend. The motel consisted of 20 units (i.e., rentable rooms) and was located near a vacation area that was popular during both the summer and winter seasons. The Kims had entered the motel business because Mrs. Kim had long wanted to run a business of her own. Both Mr. and Mrs. Kim felt that they had been successful. Each year saw a growth in revenue from room rentals. Furthermore, their bank balance had increased. They noted that many of their customers returned year after year. This was attributed to their location and their efforts to provide consistently clean ms and …show more content…
Can you help us?" Mr. Carter was interested and willing to help. He told Mrs. Kim to get the available figures for 2014 so that he could look them over that evening. The principal records the Kims kept to reflect the motel's financial transactions were a record of receipts taken from the cash register and a check book describing cash paid out. In addition, certain rough notations of other expenses incurred were available.
|EXHIBIT 1 | |
|Cash Register and Checkbook Summary During 2014 |
| | |
|Receipts |
|From rooms |$ 236,758 |
|From vending machines | 7,703 |
| Total |$ 244,461 |
| | |
|Checks Drawn |
|Owners' drawings |$ 86,100 |
|Wages and salaries | 26,305 |
|Paid to laundry | 8,800 |
|Replacement of glasses, bed linens, and | 1,660 |
|towels | |
|Advertising | 2,335 |
|Payroll taxes | 2,894 |
|Fuel

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