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Chap 2 Homework

The document provides information about several accounting transactions and financial statements: 1) It lists 9 transactions for Spade Company to record in a general journal and T-accounts, including an initial investment, purchases, sales, payments, and a withdrawal. 2) It presents a trial balance for HG's Auto Maintenance with errors, and provides details to correct the trial balance. 3) It includes a trial balance for Sally's Salon and asks to prepare financial statements from it, including an income statement, statement of owner's equity, and balance sheet. 4) It provides details from three separate companies and asks to calculate unknown amounts related to accounts payable, receivables, and cash balances.

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Taghi Mammadov
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198 views

Chap 2 Homework

The document provides information about several accounting transactions and financial statements: 1) It lists 9 transactions for Spade Company to record in a general journal and T-accounts, including an initial investment, purchases, sales, payments, and a withdrawal. 2) It presents a trial balance for HG's Auto Maintenance with errors, and provides details to correct the trial balance. 3) It includes a trial balance for Sally's Salon and asks to prepare financial statements from it, including an income statement, statement of owner's equity, and balance sheet. 4) It provides details from three separate companies and asks to calculate unknown amounts related to accounts payable, receivables, and cash balances.

Uploaded by

Taghi Mammadov
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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Chap 2 Analyzing and Recording Transactions


1. Prepare general Journal entries to record the transactions below for Spade Company
by using the following accounts: Cash; Accounts Receivable; Office Supplies; Office Equipment;
Accounts Payable; K Spade, Capital; K. Spade, Withdrawals; Fees Earned, and Rent Expense.
Use the letters beside each transaction to identify entries. After recording the transactions,
post them to T-accounts, which serves as the general ledger for this assignment. Determine
the ending balance of each T-account.
a. Kacy Spade, owner, invested $100,750 cash in the company.
b. The company purchased office supplies for $1, 250 cash.
c. The company purchased $10,050 of office equipment on credit.
d. The company received $15, 500 cash as fees for services provided to a customer.
e. The company paid $10, 050 cash to settle the payable for the office equipment purchased
in transaction c.
f. The company billed a customer $2, 700 as fees for services provided.
g. The company paid $1, 225 cash for the monthly rent.
h. The company collected $1, 225 cash as partial payment for the account receivable created
in transaction f.
i. Kacy Spade withdrew $10,000 cash from the company for personal use.

After recording the transactions in T-accounts and calculating the balance of each account,
prepare a trial balance. Use May 31, 2017, as its report date.

2. The following trial balance is prepared from the general ledger of HG's Auto
Maintenance.

HG’S AUTO MAINTENANCE


Trial Balance
October 31
Debit Credit
Cash $1,975
Accounts receivable 2,800
Supplies 500
Shop equipment 13,000
Office equipment 6,600
Accounts payable 4,510
Hal Griffin, Capital 22,000
Hal Griffin, Withdrawals 4,200
Repair fees earned 11,875
Supplies expense 8,600
Totals $37,67538,385
855
Because the trial balance did not balance, you decided to examine the accounting records.
You found that the following errors had been made:

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1. A purchase of supplies on account for $245 was posted as a debit to Supplies and as a
debit to Accounts Payable.
2. An investment of $500 cash by the owner was debited to Hal Griffin, Capital and credited
to Cash.
3. In computing the balance of the Accounts Receivable account, a debit of $600 was omitted
from the computation.
4. One debit of $300 to the Hal Griffin, Withdrawals account was posted as a credit.
5. Office equipment purchased for $800 was posted to the Shop Equipment account.
6. One entire entry was not posted to the general ledger. The transaction involved the receipt
of $125 cash for repair services performed for cash.

Prepare a corrected trial balance for the HG's Auto Maintenance as of October 31.

3. Based on the following trial balance for Sally's Salon, prepare an income statement,
statement of owner's equity, and a balance sheet. Sally Crawford made no additional
investments in the company during the year.
Sally’s Salon
Trial Balance
December 31
Cash $ 6,500
Accounts receivable 475
Beauty supplies 2,500
Beauty shop equipment 17,000
Accounts payable $ 745
S. Crawford, Capital 21,155
S. Crawford, Withdrawals 36,000
Revenue earned 72,000
Beauty supplies expense 3,425
Rent expense 6,000
Wages expense 22,000
Totals $93,900 $93,900

4. Use the information in each of the following separate cases to calculate the unknown
amount.
a. Corentine Co. had $152.000 of accounts payable on September 30 and $132.500 on
October 31. Total purchases on account during October were $281,000. Determine how much
cash was paid on accounts payable during October.
b. On September 30, Valerian Co. had a $102, 500 balance in Accounts Receivable. During
October, the company collected $102, 890 from its credit customers. The October 31 balance
in Accounts Receivable was $89,000. Determine the amount of sales on account that occurred
in October.
c. During October, Alameda Company had $102, 500 of cash receipts and $103, 150 of cash
disbursements. The October 31 Cash balance was $18,600. Determine how much cash the
company had at the close of business on September 30.
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