Individual Assignment: Fundamentals of Accounting I

1. Judi Dench is a licensed dentist. During the first month of the operation of her business,
the following events and transactions occurred.
April 1 Shareholders invested £40,000 cash in exchange for ordinary shares.
1 Hired a secretary-receptionist at a salary of £600 per week payable monthly.
2 Paid offi ce rent for the month £1,400.
3 Purchased dental supplies on account from Halo Company £5,200.
10 Performed dental services and billed insurance companies £6,600.
11 Received £1,000 cash advance from Rich Welk for an implant.
20 Received £2,100 cash for services performed for Phil Stueben.
30 Paid secretary-receptionist for the month £2,400.
30 Paid £1,900 to Halo Company for accounts payable due.
Judi uses the following chart of accounts: No. 101 Cash, No. 112 Accounts Receivable, No. 126
Supplies, No. 201 Accounts Payable, No. 209 Unearned Service Revenue, No. 311 Share
Capital—Ordinary, No. 400 Service Revenue, No. 726 Salaries and Wages Expense, and No.
729 Rent Expense.
Instructions
(a) Journalize the transactions.
(b) Post to the ledger accounts.
(c) Prepare a trial balance on April 30, 2017.
2. The unadjusted trial balance of Surf Suds Laundry at October 31, 2010, the end of the
current fiscal year, is shown below.

The data needed to determine year-end adjustments are as follows:

a. Wages accrued but not paid at October 31 are $1, 250.
b. Depreciation of equipment during the year is $9, 500.
c. Laundry supplies on hand at October 31 are $2,900.
d. Insurance premiums expired during the year are $6,000.

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Instructions
i. For each account listed in the unadjusted trial balance, enter the balance in a T account.
Identify the balance as “Oct. 31 Bal.” In addition, add T accounts for Wages Payable,
Depreciation Expense, Laundry Supplies Expense, Insurance Expense, and Income
Summary.
ii. Enter the unadjusted trial balance on an end-of-period spreadsheet (worksheet) and
complete the spreadsheet. Add the accounts listed in Part (i) as needed.
iii. Journalize and post the adjusting entries. Identify the adjustments by “Adj.” and the new
balances as “Adj. Bal.”
iv. Prepare an adjusted trial balance.
v. Prepare an income statement, a statement of owner’s equity (no additional investments
were made during the year), and a balance sheet.
vi. Journalize and post the closing entries. Identify the closing entries by “Clos.”
vii. Prepare a post-closing trial balance.
3. The trial balance of Mueller SE shown below does not balance.

Each of the listed accounts has a normal balance per the general ledger. An examination of the
ledger and journal reveals the following errors.
a. Cash received from a customer in payment of its account was debited for €570, and
Accounts Receivable was credited for the same amount. The actual collection was for
€750.
b. The purchase of a computer on account for €620 was recorded as a debit to Supplies for
€620 and a credit to Accounts Payable for €620.
c. Services were performed on account for a client for €890. Accounts Receivable was
debited for €890, and Service Revenue was credited for €89.

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 d. A debit posting to Salaries and Wages Expense of €700 was omitted.
e. A payment of a balance due for €309 was credited to Cash for €309 and credited to
Accounts Payable for €390.
f. The payment of a €600 cash dividend was debited to Salaries and Wages Expense for
€600 and credited to Cash for €600.
Instructions: Prepare a correct trial balance.

4. Prison Watch Company offers legal consulting advice to prison inmates. Prison Watch
Company prepared the end-of-period spreadsheet (work sheet) at the top of the following
page at June 30, 2010, the end of the current fiscal year.

Instructions
i. Prepare an income statement for the year ended June 30.

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 ii. Prepare a statement of owner’s equity for the year ended June 30. No additional
investments were made during the year.
iii. Prepare a balance sheet as of June 30.
iv. On the basis of the end-of-period spreadsheet (work sheet), journalize the closing
entries.
v. Prepare a post-closing trial balance.
5. Damascus Carpet has the following unadjusted trial balance as of August 31, 2010.

The debit and credit totals are not equal as a result of the following errors:
a. The balance of cash was understated by $5,250.
b. A cash receipt of $3,600 was posted as a debit to Cash of $6,300.
c. A debit of $2,250 to Accounts Receivable was not posted.
d. A return of $350 of defective supplies was erroneously posted as a $530 credit to
Supplies.
e. An insurance policy acquired at a cost of $300 was posted as a credit to Prepaid
Insurance.
f. The balance of Notes Payable was understated by $13,125.
g. A credit of $1, 575 in Accounts Payable was overlooked when determining the balance of
the account.
h. A debit of $6,125 for a withdrawal by the owner was posted as a credit to Isaiah Betts,
Capital.
i. The balance of $12,600 in Advertising Expense was entered as $1, 260 in the trial
balance.
j. Gas, Electricity, and Water Expense, with a balance of $12,075 was omitted from the trial
balance.
Instructions: Prepare a corrected unadjusted trial balance as of August 31, 2010.

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 6. On September 1, 2017, the account balances of Beck Equipment Repair, Ltd. Were as
follows.

During September, the following summary transactions were completed.

Sept. 8 Paid £1,700 for salaries due employees, of which £1,200 is for September salaries.
10 Received £1,200 cash from customers on account.
12 Received £3,400 cash for services performed in September.
15 Purchased store equipment on account £3,000.
17 Purchased supplies on account £1,900.
20 Paid creditors £4,500 on account.
22 Paid September rent £500.
25 Paid salaries £1,360.
27 Performed services on account and billed customers £1,600 for those services.
29 Received £750 from customers for future service.

Adjustment data consist of:

1. Supplies on hand £1,700.
2. Accrued salaries payable £400.
3. Depreciation is £140 per month.
4. Services related to unearned service revenue of £1,450 were performed.
Instructions
(a) Enter the September 1 balances in the ledger accounts.
(b) Journalize the September transactions.
(c) Post to the ledger accounts. Use J1 for the posting reference. Use the following additional
accounts: No. 400 Service Revenue, No. 631 Supplies Expense, No. 711 Depreciation Expense,
No. 726 Salaries and Wages Expense, and No. 729 Rent Expense.
(d) Prepare a trial balance at September 30.
(e) Journalize and post adjusting entries.
(f) Prepare an adjusted trial balance.
(g) Prepare an income statement and a retained earnings statement for September and a statement
of financial position at September 30.

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