Question

The transactions completed by PS Music during June 2018 were described at the end of Chapter 1. The following transactions were completed during July, the second month of the business's operations Peyton Smith made an additional investment in PS Music in exchange for common stock by depositing Jul $5,000 in PS Music's checking account Instead of continuing to share office space with a local real estate agency, Peyton decided to rent office space near a local music storee. Paid rent for July, $1,750 Paid a premium of $2,700 for a comprehensive insurance policy covering lability, theft, and fire. The 1 policy covers a one-year period Received $1,000 on account 2 On behalf of PS Music, Peyton signed a contract with a local radio station, KXMD, to provide guest spots for the next three months. The contract rehres PS Music to provide a guest disc jockey for 80 hours per month for a monthly fee of $3,600. Any addiional hours beyond 80 will be biled to KXMD at $40 per hour In accordance with the contract, Peyton received $7 200 from KXMD as an advance payment for the first two months Paid $250 on account Paid an altoney $900 for reviewing the July 3 contract with KXMD (Record as Miscellaneous Expense) Purchased office equipment on account from Office Mart, $7.500 5 8 Paid for a newspaper advertisement, $200. Received $1.000 for serving as a disc jockey for a party 11 Pad $700 to a local audio electronics store for rental of digital recording equipment 13 Paid wages of$1.200 to receptionist and part-tme assistant 14 ter 2 Homework Calculator Enter the following transactions on Page 2 of the two-column journal Received $2,000 for serving as a disc jockey for a wedding reception. Jul. 16 18 Purchased supplies on account, $850. Paid $620 to Upload Music for use of its current music demos in making various music sets. 21 Paid $800 to a local radio station to advertise the services of PS Music twice daily for the remainder of 22 July 23 Served as disc jockey for a party for $2,500. Received $750, with the remainder due August 4, 2018. Paid electric bill, $915 27 Paid wages of $1,200 to receptionist and part-tkne assistant. 28 Paid miscellaneous expenses, $540. 29 Served as a disc jockey for a charity ball for $1,500. Received $500, with the remainder due on August 30 9, 2018. Received $3,000 for serving as a disc jockey for a party. 31 Paid $1,400 royalties (music expense) to National Music Clearing for use of various artists' music during July Paid dividends, $1,250. 31 PS Music's chart of accounts and the balance of accounts as of July 1, 2018 (all normal balances), are as follows: $3,920 Cash 11 1.000 Accounts Receivable 12 31 Chapter 2 Homework Calculator PS Music's chart of accounts and the balance of accounts as of July 1, 2018 (all normal balances), are as follows: 11 Cash $3,920 12 Accounts Receivable 1,000 Supplies 14 170 15 Prepaid Insurance Office Equipment 17 21 Accounts Payable 250 23 Unearned Revenue 4,000 31 Common Stock 500 Dividends 33 6.200 41 Fees Earned 400 Wages Expense 50 800 Office Rent Expense 51 Equipment Rent Expense 675 52 300 Utilities Expense 53 1,590 54 Music Expense 500 Advertising Expense 55 180 Supplies Expense 56 415 Miscellaneous Expense 59 Miscellaneous Expense 59 415 Required: 1. Enter the July 1, 2018, account balances in the appropriate balance column of a four-column account. No entry is needed for accounts witha zero balance. Write Balance in the Item column, and select a check mark in the Posting Reference column. (Note: Verify the equality of the debit and credit balances in the ledger before proceeding with the next instruction) 2. Analyze and journalize each transaction in a two-column jounal beginning on Page 1, omitting journal entry explanations. Refer to the Chart of Accounts for exact wording of account titles. 3. Post the jounal to the ledger, extending the account balance to the appropriate balance column after each posting. Indicate a zero balance by inserting a 0 (zero) in either of the Balance columns opposite entry 4. Prepare an unadjusted trial balance as of July 31, 2018. Chart of Accounts CHART OF ACCOUNT NTS PS Music General Ledger REVENUE ASSETS 41 Fees Eamed 11 Cash apter 2 Homework Calculator CHART OF ACCOUNTS PS Music General Ledger ASSETS REVENUE 11 Cash 41 Fees Earned 12 Accounts Receivable 14 Supplies EXPENSES 15 Prepaid Insurance 50 Wages Expense 17 Office Equipment 51 Office Rent Expense 52 Equipment Rent Expense LIABILITIES 53 Utilities Expense 21 Accounts Payable 54 Music Expense 23 Unearned Revenue 55 Advertising Expense 56 Supplies Expense EQUITY 59 Miscellaneous Expense 31 Common Stock 33 Dividends

Answer 1

In the books of PS Music:

Date	Account Titles	Debit	Credit
July		$	$
1	Cash	5,000
	Common Stock		5,000
1	Office Rent Expense	1,750
	Cash		1,750
1	Prepaid Insurance	2,700
	Cash		2,700
2	Cash	1,000
	Accounts Receivable		1,000
3	Cash	7,200
	Unearned Revenue		7,200
3	Accounts Payable	250
	Cash		250
4	Miscellaneous Expense	900
	Cash		900
5	Office Equipment	7,500
	Accounts Payable		7,500
8	Advertising Expense	200
	Cash		200
11	Cash	1,000
	Fees Earned		1,000
13	Equipment Rent Expense	700
	Cash		700
14.	Wages Expense	1,200
	Cash		1,200
16.	Cash	2,000
	Fees Earned		2,000
18	Supplies	850
	Accounts Payable		850
21	Music Expense	620
	Cash		620
22	Advertising Expense	800
	Cash		800
23	Cash	750
	Accounts Receivable	1,750
	Fees Earned		2,500
27	Utilities Expense	915
	Cash		915
28	Wages Expense	1,200
	Cash		1,200
29	Miscellaneous Expense	540
	Cash		540
30	Cash	500
	Accounts Receivable	1,000
	Fees Earned		1,500
31	Cash	3,000
	Fees Earned		3,000
31	Music Expense	1,400
	Cash		1,400
31	Dividends	1,250
	Cash		1,250