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Acctg180 W02 Problems Accounting Cycle

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266 views

Acctg180 W02 Problems Accounting Cycle

Uploaded by

tatenda1997nkala
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as XLSX, PDF, TXT or read online on Scribd
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Jones Surf Shop has now hired you to be their accountant for all company operations.

As you take your new role you


familiarize yourself with the types of transactions and reports that Jones Surf Shop is going to need in the course of th

The following are all transactions that occurred during your first week of work. Journalize each of the following trans
follow proper journal writing rules

A. On February 3, 2023, Office furniture is purchased. The furniture cost $2,500 and the payment will be due fort
B. On February 4, 2023, An advertisement was run in the newspaper at a total cost of $250. Cash was paid when
C. On February 4, 2023, Jeremy performed a private surf class for a client. The client was billed $535.
D. On February 6, 2023, Office supplies worth $250 are purchased with cash
E. On February 7, 2023, A new rental contract for the shop is signed and six month of rent at $500 a month is pre
F. On February 7, 2023, A utility bill for $150 is paid with cash
G. On February 7, 2023, Jeremy brought in another investor for the shop. This investor contributed $15,000 in ca

A. JOURNAL
Date Description Debit Credit
February 3, 2023 Office Furniture $ 2,500
Accounts Payable $ 2,500
Purchased Office Furniture

B. JOURNAL
Date Description Debit Credit

C. JOURNAL
Date Description Debit Credit

D. JOURNAL
Date Description Debit Credit

E. JOURNAL
Date Description Debit Credit

F. JOURNAL
Date Description Debit Credit

G. JOURNAL
Date Description Debit Credit

As you finish out the month you are preparing to close our your first month with Jones Surf Shop. You take a look at
balance and prepare to make adjusting entries.

Jones Surf Shop


Unadjusted Trial Balance
February 28, 2023
Account Debit Credit
Cash $ 51,100
Accounts Receivable $ 1,890
Office Furniture $ 2,500
Supplies $ 250
Prepaid Rent $ 3,000
Accounts Payable $ 3,250
Interest Payable $ -
Salaries Payable $ -
Common Stock $ 50,000
Service Revenue $ 8,790
Advertising Expense $ 250
Interest Expense $ -
Rent Expense $ -
Utilities Expense $ 550
Salaries Expense $ 2,500
Supplies Expense $ -
Total $ 62,040 $ 62,040

You will need to make the following adjusting entries to complete the accounting period
H. On February 28, 2023, you took an inventory of supplies and discovered that $100 of supplies had been used d
I. On February 28, 2023, you need to recognize February rent expense from Prepaid Rent
J. On February 28, 2023, there was an expense for interest on the loan Jeremy took out of $150 - this won't be p
K. On February 28, 2023, a review of the timeclock system found salaries of $750 were earned by employees, bu

Jounalize each of these adjusting entries

H. JOURNAL
Date Description Debit Credit

I. JOURNAL
Date Description Debit Credit

J. JOURNAL
Date Description Debit Credit

K. JOURNAL
Date Description Debit Credit

The adjusted trial balance after your adjusting entries is completed below.

Jones Surf Shop


Adjusted Trial Balance
February 28, 2023
Account Debit Credit
Cash $ 51,100
Accounts Receivable $ 1,890
Office Furniture $ 2,500
Supplies $ 150
Prepaid Rent $ 2,500
Accounts Payable $ 3,250
Interest Payable $ 150
Salaries Payable $ 750
Common Stock $ 50,000
Revenue $ 8,790
Advertising Expense $ 250
Interest Expense $ 150
Rent Expense $ 500
Utilities Expense $ 550
Salaries Expense $ 3,250
Supplies Expense $ 100
Total $ 62,940 $ 62,940

Based on the Adjusted Trial Balance prepare the required Financial Statements

Jones Surf Shop


Income Statement
For Month Ended February 28, 2023
Revenue

Total Revenue $0
Expenses

Total Expenses $0

Net Income $0

Jones Surf Shop


Statement of Retained Earnings
For Month Ended February 28, 2023
Beginning Retained Earnings (Feb 1) $ -
Net Income
- Dividends $ -
Ending Retained Earnings (Feb 28) $ -

Jones Surf Shop


Balance Sheet
As of End of Month 1, Year 1
Assets

Total Assets $0

Liabilities

Total Liabilities $0

Stockholder's Equity

Total Stockholder's Equity $0

Total Liabilities & Stockholder's Equity $0

Jeremy is really impressed with the work you did in putting the month end reports. He asks if its matters the order in
statements are prepared. What is the order they need to be prepared in and is there a purpose to the order or could
order?
ake your new role you are going to
need in the course of their business.

of the following transactions. Be sure to

yment will be due forty-five days after delivery


0. Cash was paid when the order was placed.
illed $535.

at $500 a month is prepaid

tributed $15,000 in cash in exchange for common stock.

2,500
op. You take a look at the unadjusted trial
pplies had been used during the month

$150 - this won't be paid until maturity of the loan


ned by employees, but not yet paid
its matters the order in which financial
e to the order or could they prepared in any

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