Question

Mike Young opened Young's Carpet Cleaners on March 1. During March, the following transactions were completed. Mar. 1 14 18 Invested $18,000 cash in the business. Purchased used truck for $7,000, paying $3,000 cash and the balance on account. Purchased cleaning supplies for $1,300 on account. Paid S1,600 cash on one-year insurance policy effective March 1. Billed customers $2,800 for cleaning services. Paid S1,600 cash on amount owed on truck and S500 on amount owed on cleaning supplies. Paid $400 cash on amount owed on cleaning supplies. Paid $1,600 cash for employee salaries. Collected $1,500 cash from customers billed on March 14. Billed customers $3,500 for cleaning services Paid gas and oil for month on truck $400. Withdrew $800 cash for personal use. 20 28 31 31 The chart of accounts fro Young's Carpet Cleaners contains the following accounts: No. 101 Cash, No. 112 Accounts Receivable, No. 128 Cleaning Supplies, No. 130 Prepaid Insurance, No. 157 Equipment, No. 158 Accumulated Depreciation - Equipment, No. 201 Accounts Payable, No. 212 Salaries Payable, No. 301 M. Young, Capital, No. 306, M. Young, Drawing, No. 350 Income Summary, No. 400 Service Revenue, No. 633 gas & Oil Expense, No. 634 Cleaning Supplies Expense, No. 711 Depreciation Expense, No. 722 Insurance Expense, No. 726 Salaries Expense. Instructions: a) Journalize and post the March transactions. Use page Jl for the journal and three- column form for account. b) Prepare a trial balance at March 31 on a work sheet. c) Enter the following adjustments on the work sheet and complete the work sheet. 1) Earned but unbilled revenue at March 31 was $700. 2) Depreciation on equipment for the month was $250. 3) One-twelfth of the insurance expired. 4) An inventory count shows $600 of cleaning supplies on hand at March 31. 5) Accrued but unpaid employee salaries were $500. d) Prepare the income statement and owner's equity statement for March and a classified balance sheet at March 31. e) Journalize and post adjustment entries. f Journalize and post closing entries and complete the closing process. g) Prepare a post-closing trial balance at March 3-

Answer 1

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