Question

Sye Chase started and operated a small family architectural firm in Year 1. The firm was affected by two events: (1) Chase provided $22,800 of services on account, and (2) he purchased $6,900 of supplies on account. There were $800 of supplies on hand as of December 31, Year 1.

Required
a. b. & e. Record the two transactions in the accounts. Record the required year-end adjusting entry to reflect the use of supplies and the required closing entries. Post the entries in the T-accounts and prepare a post-closing trial balance. (Select "a1, a2, or b" for the transactions in the order they take place. Select "cl" for closing entries. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Accounts Receviable

Beg Bal
a1
end bal

supplies

One is also needed for Accounts payable, retained earnings, service revenue, supplies expense

B. Record the closure of service revenue

Record the closure of supplies expense

C. record post trial closing balance

Answer 1

A)

Date	Account title	Debit	credit
1	Accounts receivable	22800
	Service revenue		22800
	[Being services provided on account]
2	Supplies	6900
	Accounts payable		6900
	[Being supplies purchased on account]

b)

Date	Account title	Debit	credit
31 December	Supplies expense	6100
	Supplies		6100
	[Being supplies used :6900-800]

C)

Date	Account title	Debit	credit
31Dec	Service revenue	22800
	Income summary		22800
31Dec	Income summary	6100
	supplies expense		6100
	[Being expense account closed]
31Dec	Income summary	16700
	Retained earning		16700
	[Being net income closed: 22800-6100]

D)

ACCOUNTS RECEIVABLE
a-1	22800
End Bal	22800

SERVICE REVENUE
cl	22800	22800	a-1
End Bal		0

SUPPLIES
a-2	6900	6100	b
End Bal	800

ACCOUNTS PAYABLE
		6900	a-2
End Bal		6900

SUPPLIES EXPENSE
b	6100	6100	cl
Bal	0

RETAINED EARNING
		16700	cl
End Bal		16700

e)

POST CLOSING TRIAL BALANCE FOR THE YEAR ENDED DECEMBER 31 YEAR 1
Account title	Debit	credit
Accounts receivable	22800
supplies	800
Accounts payable		6900
Retained earning		16700
Total	23600	23600