Question

What are the answers to mini-practice set in McGraw Hill college accounting 15th editon?

Mini-Practice Set 1 Service Business Accounting Cycle Eli’s Consulting Services This project will give you an opportunity to apply your knowledge of accounting principles and procedures by handling all the accounting work of Eli’s Consulting Services for the month of January 2020. INTRODUCTION Assume that you are the chief accountant for Eli’s Consulting Services. During January, the business will use the same types of records and procedures that you learned about in Chapters 1 through 6. The chart of accounts for Eli’s Consulting Services has been expanded to include a few new accounts. Follow the instructions to complete the accounting records for the month of January. Eli’s Consulting Services Chart of Accounts Assets 101 Cash 111 Accounts Receivable 121 Supplies 134 Prepaid Insurance 137 Prepaid Rent 141 Equipment 142 Accumulated Depreciation—Equipment Liabilities 202 Accounts Payable Owner’s Equity 301 Trayton Eli, Capital 302 Trayton Eli, Drawing 309 Income Summary Revenue 401 Fees Income Expenses 511 Salaries Expense 514 Utilities Expense 517 Supplies Expense 520 Rent Expense 523 Depreciation Expense—Equipment 526 Advertising Expense 529 Maintenance Expense 532 Telephone Expense 535 Insurance Expense INSTRUCTIONS Open the general ledger accounts and enter the balances for January 1, 2020. Obtain the necessary figures from the postclosing trial balance prepared on December 31, 2019, which appears in Figure 6.3. Analyze each transaction and record it in the general journal. Use page 3 to begin January’s transactions. Post the transactions to the general ledger accounts. Prepare the Trial Balance section of the worksheet. Prepare the Adjustments section of the worksheet. Compute and record the adjustment for supplies used during the month. An inventory taken on January 31 showed supplies of $5,200 on hand. Compute and record the adjustment for expired insurance for the month. Record the adjustment for one month of expired rent of $4,000. Record the adjustment for depreciation of $183 on the old equipment for the month. The first adjustment for depreciation for the new equipment will be recorded in February. Complete the worksheet. Prepare an income statement for the month. Prepare a statement of owner’s equity. Prepare a balance sheet using the report form.page 193 Journalize and post the adjusting entries. Journalize and post the closing entries. Prepare a postclosing trial balance. Analyze: Compare the January 31 balance sheet you prepared with the December 31 balance sheet shown in Figure 6.4. What changes occurred in total assets, liabilities, and the owner’s ending capital? What changes occurred in the Cash and Accounts Receivable accounts? Has there been an improvement in the firm’s financial position? Why or why not? DATE TRANSACTIONS Jan. 2 Purchased supplies for $7,000; issued Check 1015. 2 Purchased a one-year insurance policy for $8,400; issued Check 1016. 7 Sold services for $20,000 in cash and $5,000 on credit during the first week of January. 12 Collected a total of $4,000 on account from credit customers during the first week of January. 12 Issued Check 1017 for $3,600 to pay for special promotional advertising to new businesses on the local radio station during the month. 13 Collected a total of $4,500 on account from credit customers during the second week of January. 14 Returned supplies that were damaged for a cash refund of $750. 15 Sold services for $20,700 in cash and $2,300 on credit during the second week of January. 20 Purchased supplies for $5,000 from White’s, Inc.; received Invoice 2384 payable in 30 days. 20 Sold services for $12,500 in cash and $3,500 on credit during the third week of January. 20 Collected a total of $5,600 on account from credit customers during the third week of January. 21 Issued Check 1018 for $7,065 to pay for maintenance work on the office equipment. 22 Issued Check 1019 for $3,600 to pay for special promotional advertising to new businesses in the local newspaper. 23 Received the monthly telephone bill for $1,025 and paid it with Check 1020. 26 Collected a total of $1,600 on account from credit customers during the fourth week of January. 27 Issued Check 1021 for $3,000 to Office Plus as payment on account for Invoice 2223. 28 Sent Check 1022 for $2,675 in payment of the monthly bill for utilities. 29 Sold services for $19,000 in cash and $2,750 on credit during the fourth week of January. 31 Issued Checks 1023–1027 for $32,800 to pay the monthly salaries of the regular employees and three part-time workers. 31 Issued Check 1028 for $12,000 for personal use. 31 Issued Check 1029 for $4,150 to pay for maintenance services for the month. 31 Purchased additional equipment for $15,000 from Contemporary Equipment Company; issued Check 1030 for $10,000 and bought the rest on credit. The equipment has a five-year life and no salvage value. 31 Sold services for $7,600 in cash and $1,620 on credit on January 31.