ACCT 23020 Lecture Notes - Lecture 17: Accrual, Accounts Payable, Balance Sheet
Get access
Related Documents
Related Questions
Morrison Accounting Services was organized on June 2 by a group of accountants to provide accounting and tax services to small businesses. The following transactions occurred during the first month of business:
June 2 | Received contributions of $10,000 from each of the three owners of the business in exchange for shares of stock. (Capital Stock) |
June 5 | Purchased a computer system for $12,000. The agreement with the vendor requires a down payment of $2,500 with the balance due in 60 days. (Computer; Cash; Accounts Payable) |
June 8 | Signed a two-year promissory note (Note Payable) at the bank and received cash of $20,000. |
June 15 | Billed $12,350 to clients for the first half of June. Clients are billed twice a month for services performed during the month, and the bills are payable within ten days. (Accounts Receivable; Service Revenue) |
June 17 | Paid a $900 bill from the local newspaper for advertising for the month of June. (Advertising Expense) |
June 23 | Received the amounts billed to clients for services performed during the first half of the month. |
June 28 | Received and paid gas, electric, and water bills (Utilities Expense). The total amount is $2,700. |
June 29 | Received the landlordâs bill for $2,200 for rent on the office space the Morrison leases. The bill is payable by the 10th of the following month. (Rent Expense; Rent Payable) |
June 30 | Paid salaries and wages for June. (Salaries Expense) The total amount is $5,670. |
June 30 | Billed $18,400 to clients for the second half of June. |
June 30 | Declared and paid dividends in the amount of $6,000. (Dividends) |
Prepare journal entries on the books of Morrison Accounting Services to record the transactions entered into during the month. Ignore depreciation expense and interest expense (weâll get to that later in the semester.)
Prepare a trial balance in good form at June 30. List the accounts in the following order: assets, liabilities, ownersâ equity, revenue, expenses, dividends. (You will find it helpful to set-up and post to T-accounts; the T-accounts are not required to be turned in for grading.)
Prepare the following financial statements in good form:
Income statement for the month of June
Statement of retained earnings for the month of June
Classified balance sheet at June 30.
Prepare journal entries to record the June transactions inthe General Journal below. | |||||||
General Journal | |||||||
Date | Description(Account Name) | Debit | Credit | ||||
1-Jun | Cash | $10,000 | |||||
Accounts Receivable | $1,500 | ||||||
Supplies | $1,250 | ||||||
Office Equipement | $7,500 | ||||||
DustinLarkin, Capital | $20,250 | ||||||
1-Jun | Pre-Paid Rent | $4,500 | |||||
Cash | $4,500 | ||||||
2-Jun | Prepaid Insurance | $1,800 | |||||
Cash | $1,800 | ||||||
4-Jun | Cash | $3,000 | |||||
Unearned Fees | $3,000 | ||||||
5-Jun | Office Equipment | $1,800 | |||||
AccountsPayable | $1,800 | ||||||
6-Jun | Cash | $800 | |||||
AccountsReceivable | $800 | ||||||
10-Jun | Miscellaneous Expense | $120 | |||||
Cash | $120 | ||||||
12-Jun | Accounts Payable | $800 | |||||
Cash | $800 | ||||||
12-Jun | Accounts Receivable | $2,250 | |||||
Fees Earned | $2,250 | ||||||
14-Jun | Salary Expense | $400 | |||||
Cash | $400 | ||||||
17-Jun | Cash | $3,175 | |||||
Fees Earned | $3,175 | ||||||
18-Jun | Supplies | $750 | |||||
Cash | $750 | ||||||
20-Jun | Accounts Receivable | $1,100 | |||||
Fees Earned | $1,100 | ||||||
24-Jun | Cash | $1,850 | |||||
Fees Earned | $1,850 | ||||||
26-Jun | Cash | $1,600 | |||||
Accounts Receivable | $1,600 | ||||||
27-Jun | Salaries expenses | $400 | |||||
Cash | $400 | ||||||
29-Jun | Miscellaneous expenses | $130 | |||||
Cash | $130 | ||||||
30-Jun | Miscellaneous expenses | $200 | |||||
Cash | $200 | ||||||
30-Jun | Cash | $2,050 | |||||
Fees earned | $2,050 | ||||||
30-Jun | AccountsReceivable | $1,000 | |||||
FeesEarned | $1,000 | ||||||
30-Jun | Dustin Larkin, Drawings | $4,500 | |||||
Cash | $4,500 | ||||||
$52,475 | $52,475 | ||||||
Note: Remember that Debits must equal Credits -All of your Journal Entries should balance. Need help with problems below: 1.Please prepare the adjusting entries A-F a. Insurance expired during Junes is $150 b.Supplies on hand on June 30 are $1,020 c. Depreciation of office equipment for June is $500 d. Accrued receptionist salart on June 30 is $120 e. Rent expired during June is $1,500 f. Unearned fees on June 30 are $2,000 2. Prepare an income statement, a statment of owners equity , and abalance sheet 3. Journalize and post the adjusting entries 4. Journalize and post the closing entries. (income summary isaccount #33 in the chart of accounts) 5. Prepare a post-closing trial balance PLEASE GIVE ANSWER TO #"S 3, 4 and 5. |
Hello,
i am in accounting and having trouble with my general ledger. i need help with the set up and exactly how to do the balances. its not clicking with me at all. below i have included the information on the problem im working on, and would be great if i could some help.
Journal Entries and Trial Balance
On June 1, 2016, Kim Wheeler established an interior decorating business, Intrex Designs. During the month, Kim completed the following transactions related to the business.
June | 1 | Kim transferred cash from a personal bank account to an account to be used for the business, $18,400. |
4 | Paid rent for period of June 4 to end of month, $1,780. | |
6 | Purchased a truck for $15,000, paying $1,000 cash and giving a note payable for the remainder. | |
8 | Purchased equipment on account, $7,180. | |
10 | Purchased supplies for cash, $1,230. | |
12 | Paid annual premiums on property and casualty insurance, $2,760. | |
15 | Received cash for job completed, $7,730. | |
23 | Paid creditor a portion of the amount owed for equipment purchased on June 13, $2,560. | |
24 | Recorded jobs completed on account and sent invoices to customers, $8,800. | |
25 | Received an invoice for truck expenses, to be paid in July, $810. | |
26 | Paid utilities expense, $920. | |
27 | Paid miscellaneous expenses, $330. | |
28 | Received cash from customers on account, $3,680. | |
29 | Paid wages of employees, $2,450. | |
30 | Withdrew cash for personal use, $2,040. |
Required:
1. Journalize each transaction in a two-column journal, beginning on Page 1, referring to the following chart of accounts in selecting the accounts to be debited and credited. (Do not insert the account numbers in the journal at this time.) Journal entry explanations may be omitted. For a compound transaction, if an amount box does not require an entry, leave it blank.
11 Cash | 31 Kim Wheeler, Capital |
12 Accounts Receivable | 32 Kim Wheeler, Drawing |
13 Supplies | 41 Fees Earned |
14 Prepaid Insurance | 51 Wages Expense |
16 Equipment | 53 Rent Expense |
18 Truck | 54 Utilities Expense |
21 Notes Payable | 55 Truck Expense |
22 Accounts Payable | 59 Miscellaneous Expense |
General Journal | Page 1 | |||
---|---|---|---|---|
Date | Description | Post. Ref. | Debit | Credit |
2016 | ||||
June 1 | Cash | |||
Kim Wheeler, Capital | ||||
June 4 | Rent Expense | |||
Cash | ||||
June 6 | Truck | |||
Cash | ||||
Notes Payable | ||||
June 8 | Equipment | |||
Accounts Payable | ||||
June 10 | Supplies | |||
Cash | ||||
June 12 | Prepaid Insurance | |||
Cash | ||||
June 15 | Cash | |||
Fees Earned |
General Journal | Page 2 | |||
---|---|---|---|---|
Date | Description | Post. Ref. | Debit | Credit |
2016 | ||||
June 23 | Equipment | |||
Accounts Payable | ||||
June 24 | Accounts Receivable | |||
Fees Earned | ||||
June 25 | Truck Expense | |||
Accounts Payable | ||||
June 26 | Utilities Expense | |||
Cash | ||||
June 27 | Miscellaneous Expense | |||
Cash | ||||
June 28 | Cash | |||
Accounts Receivable | ||||
June 29 | Wages Expense | |||
Cash | ||||
June 30 | Kim Wheeler, Drawing | |||
Cash |
2. Post (in chronological order) the journal to a ledger of four-column accounts, inserting appropriate posting references in the general journal as each item is posted. Extend the balances to the appropriate balance columns after each transaction is posted. If an amount box does not require an entry, leave it blank.
General Ledger | ||||||
---|---|---|---|---|---|---|
Account | Cash | ACCOUNT NO. | 11 | |||
Balance | ||||||
Date | Item | Post. Ref. | Debit | Credit | Debit | Credit |
2016 | ||||||
June 1 | ||||||
June 4 | ||||||
June 6 | ||||||
June 10 | ||||||
June 12 | ||||||
June 15 | ||||||
June 23 | ||||||
June 26 | ||||||
June 27 | ||||||
June 28 | ||||||
June 29 | ||||||
June 30 |
Account | Accounts Receivable | ACCOUNT NO. | 12 | |||
---|---|---|---|---|---|---|
Balance | ||||||
Date | Item | Post. Ref. | Debit | Credit | Debit | Credit |
2016 | ||||||
June 24 | ||||||
June 28 |
Account | Supplies | ACCOUNT NO. | 13 | |||
---|---|---|---|---|---|---|
Balance | ||||||
Date | Item | Post. Ref. | Debit | Credit | Debit | Credit |
2016 | ||||||
June 10 |
Account | Prepaid Insurance | ACCOUNT NO. | 14 | |||
---|---|---|---|---|---|---|
Balance | ||||||
Date | Item | Post. Ref. | Debit | Credit | Debit | Credit |
2016 | ||||||
June 12 |
Account | Equipment | ACCOUNT NO. | 16 | |||
---|---|---|---|---|---|---|
Balance | ||||||
Date | Item | Post. Ref. | Debit | Credit | Debit | Credit |
2016 | ||||||
June 8 |
Account | Truck | ACCOUNT NO. | 18 | |||
---|---|---|---|---|---|---|
Balance | ||||||
Date | Item | Post. Ref. | Debit | Credit | Debit | Credit |
2016 | ||||||
June 6 |
Account | Notes Payable | ACCOUNT NO. | 21 | |||
---|---|---|---|---|---|---|
Balance | ||||||
Date | Item | Post. Ref. | Debit | Credit | Debit | Credit |
2016 | ||||||
June 6 |
Account | Accounts Payable | ACCOUNT NO. | 22 | |||
---|---|---|---|---|---|---|
Balance | ||||||
Date | Item | Post. Ref. | Debit | Credit | Debit | Credit |
2016 | ||||||
June 8 | ||||||
June 23 | ||||||
June 25 |
Account | Kim Wheeler, Capital | ACCOUNT NO. | 31 | |||
---|---|---|---|---|---|---|
Balance | ||||||
Date | Item | Post. Ref. | Debit | Credit | Debit | Credit |
2016 | ||||||
June 1 |
Account | Kim Wheeler, Drawing | ACCOUNT NO. | 32 | |||
---|---|---|---|---|---|---|
Balance | ||||||
Date | Item | Post. Ref. | Debit | Credit | Debit | Credit |
2016 | ||||||
June 30 |
Account | Fees Earned | ACCOUNT NO. | 41 | |||
---|---|---|---|---|---|---|
Balance | ||||||
Date | Item | Post. Ref. | Debit | Credit | Debit | Credit |
2016 | ||||||
June 15 | ||||||
June 24 |
Account | Wages Expense | ACCOUNT NO. | 51 | |||
---|---|---|---|---|---|---|
Balance | ||||||
Date | Item | Post. Ref. | Debit | Credit | Debit | Credit |
2016 | ||||||
June 29 |
Account | Rent Expense | ACCOUNT NO. | 53 | |||
---|---|---|---|---|---|---|
Balance | ||||||
Date | Item | Post. Ref. | Debit | Credit | Debit | Credit |
2016 | ||||||
June 4 |
Account | Utilities Expense | ACCOUNT NO. | 54 | |||
---|---|---|---|---|---|---|
Balance | ||||||
Date | Item | Post. Ref. | Debit | Credit | Debit | Credit |
2016 | ||||||
June 26 |
Account | Truck Expense | ACCOUNT NO. | 55 | |||
---|---|---|---|---|---|---|
Balance | ||||||
Date | Item | Post. Ref. | Debit | Credit | Debit | Credit |
2016 | ||||||
June 25 |
Account | Miscellaneous Expense | ACCOUNT NO. | 59 | |||
---|---|---|---|---|---|---|
Balance | ||||||
Date | Item | Post. Ref. | Debit | Credit | Debit | Credit |
2016 | ||||||
June 27 |
3. Prepare an unadjusted trial balance for Intrex Designs as of June 30, 2016. For those boxes in which no entry is required, leave the box blank. The first two account titles are filled in as an example.
Intrex Designs Unadjusted Trial Balance June 30, 2016 | ||
---|---|---|
Debit Balances | Credit Balances | |
Cash | ||
Accounts Receivable | ||
Totals |
4. Determine the excess of revenues over expenses for June.
$