Question

The general ledger of Pipers Plumbing at January 1, 2021, includes the following account balances: Accounts...

The general ledger of Pipers Plumbing at January 1, 2021, includes the following account balances:

Accounts Debits Credits
Cash $ 3,750
Accounts Receivable 8,750
Supplies 2,750
Equipment 21,000   
Accumulated Depreciation $ 5,000
Accounts Payable 3,000
Utilities Payable 4,000
Deferred Revenue 0
Common Stock 15,500
Retained Earnings 8,750
Totals $ 36,250 $ 36,250

The following is a summary of the transactions for the year:

1. January 24 Provide plumbing services for cash, $12,500, and on account, $57,500.
2. March. 13 Collect on accounts receivable, $45,500.
3. May. 6 Issue shares of common stock in exchange for $10,000 cash.
4. June. 30 Pay salaries for the current year, $31,500.
5. September. 15 Pay utilities of $4,000 from 2020 (prior year).
6. November. 24 Receive cash in advance from customers, $7,000.
7. December. 30 Pay $1,500 cash dividends to stockholders.

The following information is available for the adjusting entries.

Depreciation for the year on the machinery is $5,000. Plumbing supplies remaining on hand at the end of the year equal $1,000. Of the $7,000 paid in advance by customers, $5,500 of the work has been completed by the end of the year. Accrued utilities at year-end amounted to $7,500.

- Questions: Journal entry Worksheet:

1- Jan 24: Record plumbing services provided for cash, $12,500, and on account, $57,500.

2- March 13: Record the collection on accounts receivable, 45,500.

3- May 6: Record the issuance of shares of common stock in exchange for $10,000 cash.

4- June 30: Record the payment of salaries for the current year, $31,500.

5- September 15: Record the payment of utilities of $4,000 from 2020.

6- Nov 24: Record the cash received in advance from customers, $7,000.

7- December 30: Record payment of $1,500 cash dividends to stockholders.

8- December 31: Record the adjusting entry for depreciation.

9- December 31: Record the adjusting entry for supplies.

10- December 31: Record the adjusting entry for revenue earned. Of the $7,000 paid in advance by customers, $5,500 of the work has been completed by the end of the year.

11- December 31: Record the adjusting entry for accrued utilities. Accrued utilities at year-end amounted to $7,500.

12- December 31: Record the closing entry for revenue.

13- December 31: Record the closing entry for expenses.

14- December 31: Record the closing entry for cash dividends.

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Answer #1
Pipers Plumbing
Journal entries
No. Date Account Debit Credit Calculation
1 24-Jan Cash $     12,500
Accounts Receivable $     57,500
Service Revenue $     70,000
2 13-Mar Cash $     45,500
Accounts Receivable $     45,500
3 6-May Cash $     10,000
Common Stock $     10,000
4 30-Jun Salaries expense $     31,500
Cash $     31,500
5 15-Sep Utilties Payable $        4,000
Cash $        4,000
6 24-Nov Cash $        7,000
Deferred Revenue $        7,000
7 30-Dec Dividends $        1,500
Cash $        1,500
Adjusting entries
8 31-Dec Depreciation expense $        5,000
Accumulated Depreciation $        5,000
9 31-Dec Supplies expenses $        1,750 =2,750-1,000
Supplies $        1,750
10 31-Dec Deferred Revenue $        5,500
Service Revenue $        5,500
11 31-Dec Utilties expenses $        7,500
Utilties Payable $        7,500
Closing entries
12 31-Dec Service Revenue $     75,500
Retained Earnings $     75,500
13 31-Dec Retained Earnings $     45,750
Salaries expense $     31,500
Utilties expenses $        7,500
Supplies expenses $        1,750
Depreciation expense $        5,000
14 31-Dec Retained Earnings $        1,500
Dividends $        1,500
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