Question

Problem 3-6A Applying the accounting cycle LO P1, P2, P3, P4, P5 On April 1, 2017, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the company's first month. April 1 Nozomi invested $A7,000 cash and computer equipment worth $25,000 in the company in exchange for common stock. 2 The company rented furnished office space by paying $2,500 cash for the first month's (April) rent. 3 The company purchased $1,100 of office supplies for cash. 10 The company paid $2.500 cash for the prenium on a 12-month insurance policy. Coverage begins on April 11. 14 The company paid $880 cash for two weeks salaries earned by employees. 24 The company collected $21.0ee cash on commissions from airlines on tickets obtained for custoners. 28 The company paid $800 cash for two weeks salaries earned by employees. 29 The company paid $250 cash for minor repairs to the company's computer 30 The company paid $1,350 cash for this month's telephone bill. 30 The company paid $1,800 cash in dividends. The company's chart of accounts follows: 485 Commissions Earned 101 Cash 612 Depreciation Expense-Computer Equip. 622 Salaries Expense 637 Insurance Expense 640 Rent Expense 65e office Supplies Expense 684 Repairs Expense 688 Telephone Expense 901 Income Sumary 106 Accounts Receivable 124 office Supplies 128 Prepaid Insurance 167 Computer Equipment 168 Accumulated Depreciation-Computer Equip. 209 Salaries Payeble 307 Common Stock 318 Retained Earnings 319 Dividends Use the following information: b. At the end of the month, $700 of office supplies are still available. c. This month's depreciation on the computer equipment is $600 a. Two-thirds (or $139) of one month's insurance coverage has expired Next 8 of 8 < Prey

Answer 1

Date Debit General Journal Credit Apr-01 Cash Computer equipment Gonzalez,capital 47000 25000 72000 Apr-02 Rent expense 2500 cash 2500 Apr-03 Office supplies 1100 1100 casl Apr-10 Prepaid insurance 2500 cash 2500 Apr-14 Salar 800 expense cash 800 Apr 24 Cash 21000 21000 commissions earned Apr-28 Salaries expense 800 cash 800 Apr-29 Repairs expense 250 cash 250 Apr-30 Telephone expenses 1350 cash 1350 Apr-30 Gonzale cash withdrawals 1800 1800 Adjusting entries a. Insurance expense Prepaid insurance 139 139 Office supplies expense office supplies 400 400 dep. Expense-computer 600 Accumulated dep.-computer 600 Salaries expense 500 salaries payable 500 Accounts receivable 2000 commissions earned 2000 Closing entries Commissions earnec 23000 Income Summary 23000 Income summary 7339 Computer 2100 Insurance expense 139 Rent expense Office supplies expense 2500 400 Repairs expense Telephone expense 250 1350 Income summary 15661 Retained earnings 15661 Retained earnings 1800 Dividends 1800

Cash Cammon stok Credit Balance Debit Debit Dat Credit Balance Apr-01 47000 47000 Apr-01 72000 2000 Apr-0: 250 44500 10 40900 Apr-14 80 40100 Commissions earned 61100 Debit Balance Agr 24 21000 Dato Credit Apr-24 Apr-28 60300 21000 21000 2000 23000 20 - 23000 Apr-30 190 56900 Computer equipment Debit Credit Balance Accumulated dep.-computer Credit 600 Debit Apr-01 25000 25000 Dat Balance 600 Rent expense Datc Balance Debi Credit Salaries payable Debit Apr-02 2507 500 Credit 2500 Dat Balance Office supplies Credit Balance Deb Date Apr-03 110C 1100 700 400 retained earnings Debit Credit Balance Prepaid insurance Debit Dat Credit Balance Date b. 1566 1565 386. Apr-10 2500 2500 1800 13 2361 alarics TCrodis Debit Balance Dat Apr-14 800 800 1600 Anr-28 800 500 2100 u. 2100 Repairs expense Credit Balance Dat: Debit Apr-25 250 250 250 Telephone expense Credit Balance Dati Debit Apr 30 1350 1350 1350 Dividends Balance Credit Date Debit Apr-3t 1800 180 1800 Insurance expense Debit Credit Balance Date 139 139 139 Office supplies expenso Debit Credit Balance Date h. 40 100 400 dep. Expense-pompute Debit Balance Date Credit 600 600 600 Accounts receivable Dcbit Credit Balance 2000 Date 2000

Unadjusted trial balance Adjustments Adjusted trial balance 56900 Cash 56900 Accounts receivable Office supplies Prepaid insurance Computer equipment Accumulated dep.-computer Salaries payable 2000 2000 1100 400 700 2500 139 2361 25000 25000 600 600 500 500 Common stock 72000 72000 Dividends 1800 1800 Commissions earned 21000 2000 23000 dep. Expense-computer Salaries expense 600 600 1600 500 2100 Insurance expense 139 139 Rent expense 2500 2500 Office supplies expense Repairs expense Telephone expense 400 400 250 25C 1350 1350 93000 Total 93000 3639 96100 96100 3639 Income statement 23000 Commissions earned Less:expenses dep. Expense-computer 600 Salaries expense 2100 Insurance expense Rent expense Office supplies expense Repairs expense 139 2500 400 250 Telephone expense 1350 Total expenses 7339 Net Income 15661 Statement of retained earnings Opening Balance Add: Net Income 15661 Less: Withdrawals -1800 Closing balance 13861

Balance sheet Cash 56900 Accounts receivable 2000 Office supplies Prepaid insurance 700 2361 25000 Computer equipment Accumulated dep.-computer -600 24400 Total Assets 86361 Liabilities Salaries payable 500 Equity Common stock 72000 Retained earnings Total liabilties & equity 13861 85861 86361 Post closing trial balance Cash 56900 Accounts receivable 2000 Office supplies 700 Prepaid insurance Computer equipment Accumulated dep.-computer Salaries payable 2361 25000 600 500 Common stock 72000 retained earnings 13861 total 86961 86961