ACCT 217 Chapter Notes - Chapter 3: Trial Balance, Retained Earnings, General Ledger
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Elite RealtyGeneral Ledger
ASSETS | |
11 | Cash |
12 | Accounts Receivable |
13 | Prepaid Insurance |
14 | Office Supplies |
16 | Land |
LIABILITIES | |
21 | Accounts Payable |
22 | Unearned Rent |
23 | Notes Payable |
EQUITY | |
31 | Common Stock |
32 | Retained Earnings |
33 | Dividends |
REVENUE | |
41 | Fees Earned |
EXPENSES | |
51 | Salary and Commission Expense |
52 | Rent Expense |
53 | Advertising Expense |
54 | Automobile Expense |
59 | Miscellaneous Expense |
Elite Realty acts as an agent in buying, selling, renting, andmanaging real estate. The unadjusted trial balance on March 31,2018, follows:
Elite Realty
UNADJUSTED TRIAL BALANCE
March 31, 2018
ACCOUNT TITLE | DEBIT | CREDIT | |
---|---|---|---|
1 | Cash | 26,700.00 | |
2 | Accounts Receivable | 59,300.00 | |
3 | Prepaid Insurance | 3,100.00 | |
4 | Office Supplies | 2,100.00 | |
5 | Accounts Payable | 12,700.00 | |
6 | Common Stock | 10,000.00 | |
7 | Retained Earnings | 36,100.00 | |
8 | Dividends | 2,300.00 | |
9 | Fees Earned | 234,500.00 | |
10 | Salary and Commission Expense | 145,000.00 | |
11 | Rent Expense | 29,000.00 | |
12 | Advertising Expense | 16,700.00 | |
13 | Automobile Expense | 5,100.00 | |
14 | Miscellaneous Expense | 4,000.00 | |
15 | Totals | 293,300.00 | 293,300.00 |
The following business transactions were completed by EliteRealty during April 2018. Enter the transactions through the 23rdon Page 18 of the two-column journal:
Apr. | 1 | Paid rent on office for month,$4,500. |
2 | Purchased office supplies onaccount, $2,200. | |
5 | Paid insurance premiums,$5,100. | |
10 | Received cash from clients onaccount, $53,000. | |
15 | Purchased land for a futurebuilding site for $230,500, paying $22,000 in cash and giving anote payable for the remainder. | |
17 | Paid creditors on account,$6,100 | |
20 | Returned a portion of theoffice supplies purchased on April 2, receiving full credit fortheir cost, $330. | |
23 | Paid advertising expense,$4,500. |
Enter the following transactions on Page 19 of the two-columnjournal:
Apr. | 27 | Discovered an error incomputing a commission; received cash from the salesperson for theoverpayment, $3,000. |
28 | Paid automobile expense(including rental charges for an automobile), $1,700. | |
29 | Paid miscellaneous expenses,$1,800. | |
30 | Recorded revenue earned andbilled to clients during the month, $54,000. | |
30 | Paid salaries and commissionsfor the month, $11,900. | |
30 | Paid dividends, $4,000. | |
30 | Rented land purchased on April15 to local merchants association for use as a parking lot in Mayand June, during a street rebuilding program; received advancepayment of $10,200. |
Required: | |
---|---|
1. | Record the April 1, 2018,balance of each account in the appropriate balance column of afour-column account, type Balance in the item section, and select acheck mark in the Posting Reference column. |
2. | Journalize the transactionsfor April in a two-column journal beginning on Page 18. Refer tothe Chart of Accounts for exact wording of account titles. Insertthe appropriate posting references in both the journal and theledger as each item is posted. |
3. | Post to the ledger, extendingthe account balance to the appropriate balance column after eachposting. Post in chronological order. For transactions occurring onthe same day, post in the order presented in the instructions.Insert the appropriate posting references in both the journal andthe ledger as each item is posted. |
4. | Prepare an unadjusted trialbalance of the ledger as of April 30, 2018. |
5. | Assume that the April 30transaction for salaries and commissions should have been $19,100.(a) Why did the unadjusted trial balance in (4) balance? (b)Journalize the correcting entry on April 30. Use page 20. (Note:You will not be required to post this entry to the ledger at thistime.) (c) Is this error a transposition or slide? |
Solve the problem
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.
$