Question

Problem 3.39 Journalizing, Posting, and Preparing a Trial Balance Listed for each account Jersey Enterprises uses the following general ledger accounts in its accounting system. Listed for each is its balance as of January 1, 2020. Identify each amount as a debit balance or a credit balance, making sure that Total Debits - Total Credits. Cash Accounts Receivable Supplies on Hand (Asset) Office Equipment Accumulated Depreciation Office Equipmt Accounts Payable Common Stock Retained Earnings Fee Revenue Selling Expense Salary Expense Balance $ 80,000 85,000 30,000 325,000 135,000 70,000 90,000 225,000 In early January 2020, Jersey Enterprises engaged in the following transactions: January 2 Paid $30,000 on accounts payable January 5 Purchased $2,100 of supplies with cash January 5 Purchased office equipment for $4,700 cash January 6 Earned and received fees (revenues) of $16,400 from customers January 7 Paid selling expenses of $7,100 January 8 Received $25,000 from customers who had owed money at January 1 January 9 Paid employee salaries of $15,200 Required: a. Why do some of Jersey's accounts have zero balances at the beginning of January? b. Make a single compound journal entry for all of the opening balances at January 1, 2020. C. Prepare general ledger accounts for Jersey Enterprises as of January 1, 2020 and post the opening balance to each account. d. Make journal entries for each of the transactions described above for January 2-9. e. Post the journal entries to the general ledger accounts, and calculate balances as of January 9. Prepare a trial balance for Jersey Enterprises as of January 9, 2020.

Answer 1

Req 1

Income Statement accounts like below

Fee Revenue

Selling Expense

Salary Expense

These are all temporary accounts that are closed to Retained Earnings at period end

as part of closing process

So all temporary accounts have zero balance

Debit Credit Jersey Enterprises Journal entries Date Account Reqb 1-Jan Cash Accounts Receivable Supplies on Hand Office Equipment Accumulated Depreciation Office Equipment Accounts Payable Common Stock Retained Earnings Reqd 2-Jan Accounts Payable Cash $ 80,000 $ 85,000 $ 30,000 $ 325,000 $ 135,000 $ 70,000 $ 90,000 $ 225,000 $ 30,000 $ 30,000 $ 2,100 5-Jan Supplies on Hand Cash $ 2,100 $ 4,700 5-Jan Office Equipment Cash $ 4,700 $ 16,400 6-Jan Cash Fee Revenue $ 16,400 $ 7,100 7-Jan Selling Expense Cash $ 7,100 $ 25,000 8-Jan Cash Accounts Receivable $ 25,000 $ 15,200 9-Jan Salary Expense Cash $ 15,200

Credit Jersey Enterprises T Accounts Date Debit Date Credit Date Cash Op bal $ 80,000 2-Jan $ 30,000 Op bal 6-Jan $ 16,400 5-Jan $ 2,100 8-Jan $ 25,000 5-Jan $ 4,700 7-Jan $ 7,100 9-Jan $ 15,200 Debit Date Credit Date Debit Date Accounts Receivable Supplies on Hand $ 85,000 8-Jan $ 25,000 Op bal $30,000 5-Jan $ 2,100 Bal. Bal. Bal. $ 32,100 $ 62,300 Office Equipment $325,000 $ 4,700 $ 60,000 Accum. Depr.- Office Equip Op bal $135,000 Op bal 5-Jan $135,000 Bal. $329,700 Accounts Payable 2-Jan $ 30,000 Op bal Bal. Common Stock Op bal Retained Earnings Op bal $ 70,000 $ 90,000 $225,000 $ 40,000 $ 90,000 $225,000 Bal. Fee Revenue 6-Jan Bal. Selling Expense $ 7,100 Bal. Salary expense $ 15,200 $ 16,400 7-Jan 9-Jan Bal. $16,400 Bal. $ 7,100 Bal. $ 15,200

Jersey Enterprises Account Names Cash Accounts Receivable Supplies on Hand Office Equipment Accumulated Depreciation Office Equipment Accounts Payable Common Stock Retained Earnings Fee Revenue Selling Expense Salary Expense Totals Trial Balance Debit Credit 62,300 60,000 32,100 329,700 135,000 40,000 90,000 225,000 16,400 7,100 15,200 506,400 506,400