Question

At June 30, 2017, the end of its most recent fiscal year Green River Computer Consultants post-closing trial balance was as follows: Credit Cash Debit $5.230 1.200 Accounts receivable Supplies 690 Accounts payable $400 1.120 Unearned service revenue Common stock 3.600 Retained earnings 2.000 $7.120 57,120 The company underwent a major expansion in July, New staff was hired and more financing was obtained, Green River conducted the following transactions during July 2017, and adjusts its accounts monthly July 1Purchased equipment paying $4.000 cash and signing a 2-year note payable for $20.000. The equipment has a 4-year useful life. The note hasa 6% interest rate which is payable on the first day of each following month 2. Issued 20,000 shares of common stock for $50,000 cash 3 Paid $3.600 cash for a 12-month insurance policy effective July 1. 3 Paid the first 2 Ouly and August 2017) months' rent for an annual lease of office space for $4000 per month 6 Paid $3.800 for supplies Visited dient offices and agreed on the terms of a consulting project. Green River will bill the client. Connor Productions on the 20th of each month for services performed 10 Collected $1.200 cash on account from Milani Brothers. This client was biled in June when Green River performed the service Performed services for Enterprises. This dient paid $1.120 in advance last month All services relating to this payment are now completed 14 Paid $400 cash for a utility bill. This related to June utilities that were accrued at the end of June. 16 Met with a new client, Thunder Bay Technologies. Received $12.000 cash in advance for future services to be performed. 18 Paid semi-monthly salaries for $11,000 20 Performed services worth $28.000 on account and billed customers. 20 Received a bill for $2.200 for advertising services received during July. The amount is not due until August 15. 23 Performed the first phase of the project for Thunder Bay Technologies. Recognized $10,000 of revenue from the cash advance received July 16. 27 Received $15,000 cash from customers billed on July 20

Answer 1

Worksheet For the Month ending 31.7.2017 Particulars Cash Accounts Receivable Supplies Prepaid Insurance Prepaid Rent Equipment Accum. Depre - Equip. Accounts Payable Unearned Service Revenue Interest Payable Salaries Payable Income Tax Payable Note Payable Common Stock Retained Earnings Service Revenue Salaries Expense Advertising Expense Insurance Expense Rent Expense Supplies Expense Depreciation Expense Interest Expense Utilities Expense Income Tax Expense Totals Unadjusted Adjustments Adjusted Post closing Debit in $ Credit in $ Debit in $ Credit in $ Debit in $ Credit in $ Debit in $ Credit in $ 56630 56630 56630 13000 13000 13000 4490 1250 3240 3240 3600 300 3300 3300 4000 4000 24000 24000 24000 500 500 500 2200 800 3000 3000 2000 2000 2000 100 100 100 11000 11000 11000 1200 1200 1200 20000 20000 20000 53600 53600 53600 2000 2000 8770 39120 39120 11000 11000 22000 2200 2200 300 300 4000 4000 1250 1250 500 500 100 100 800 800 1200 1200 118920 118920 19150 19150 132520 132520 100170 100170

Dr. Closing Enteries Date Particulars 31.7.2017 Income Summary a/c To Salaries Expense To Advertising Expense To Insurance Expense To Rent Expense To Supplies Expense To Depreciation Expense To Interest Expense To Utilities Expense To Income Tax Expense (Expense accounts closed) Debit in $ Credit in $ 32350 22000 2200 300 4000 1250 500 100 800 1200 Dr. 39120 31.7.2017 Service Revenue a/c To Income Summary (Revenue accounts closed) 39120 Dr. 6770 31.7.2017 Income Summary a/c To Retained Earnings (Profits transferred) 6770