Question

The general ledger of the Karlin Company, a consulting company, at January 1, 2021, contained the following account balances: Credits Debits 32,300 12,000 19,000 points Account Title Cash Accounts receivable Equipment Accumulated depreciation Salaries payable Common stock Retained earnings Total eBook 5,700 7,000 43,000 7,600 63,300 Print 63,300 References The following is a summary of the transactions for the year: a. Service revenue, $110,000, of which $33,000 was on account and the balance was received in cash. b. Collected on accounts receivable, $23,200. c. Issued shares of common stock in exchange for $9,500 in cash. d. Paid salaries, $40,000 (of which $7,000 was for salaries payable at the end of the prior year). e. Paid miscellaneous expense for various items, $21,600. f. Purchased equipment for $12,000 in cash. g. Paid $2,625 in cash dividends to shareholders. 1. Accrued salaries at year-end amounted to $800. 2. Depreciation for the year on the equipment is $1,900.
Post the transactions, adjusting and closing entries into the appropriate t-accounts.

Answer 1

Cash					Accounts Receivable
Beg. Bal.	32300				Beg. Bal.	12000
a.	77000	40000	d.		a.	33000	23200	b.
b.	23200	21600	e.
c.	9500	12000	f.
		2625	g.
End. Bal.	65775				End. Bal.	21800
Equipment					Accumulated Depreciation
Beg. Bal.	19000				Beg. Bal.		5700
f.	12000						1900	Adj. 2
End. Bal.	31000				End. Bal.		7600
Salaries Payable					Common Stock
Beg. Bal.		7000			Beg. Bal.		43000
d.	7000	800	Adj. 1				9500	c.
End. Bal.		800			End. Bal.		52500
Retained Earnings					Dividends
Beg. Bal.		7600			g.	2625
CE4	2625	52700	CE3				2625	CE4
End. Bal.		57675			End. Bal.	0
Service Revenue					Miscellaneous Expense
Beg. Bal.		0			Beg. Bal.	0
CE1	110000	110000	a.		e.	21600	21600	CE2
End. Bal.		0			End. Bal.	0
Depreciation Expense					Salaries Expense
Beg. Bal.	0				Beg. Bal.	0
Adj.2	1900	1900	CE2		d.	33000	33800	CE2
					Adj. 1	800
End. Bal.	0				End. Bal.	0
Income Summary
Beg. Bal.	0
CE2	57300	110000	CE1
CE3	52700
End. Bal.		0