Question

Problem Section: Complete the accounting cycle for the period January 1 to February 28, 2018, We Do Taxes Company started operations as of January 1, 2018 and set up a small office in Edison to prepare tax returns and perform accounting services. Use the information to follow to journalize each transaction on the Journal Sheet Jan Contributed the following assets for common stock. Cash, $15.000; accounts receivable. $1,000: Supplies S2,000, and office equipment, $12,000. There were no liabilities contributed Jan Paid six months rent on a lease rental contract, S5,400. Jan 3 Paid premiums on property and casualty insurance policies for the year. $1,800. Jan 5 Received cash from clients as an advance payment for services to be provided and recorded it as unearned fees. $6,000 Jan 10 Received cash from clients on account $500 Jan 20 paid cash for advertising in a local newspaper, $350. Jan 21 Purchased a new computer and other office equipment on account from Staples, S3,500. Jan 21 Paid part-time receptionist for two weeks' salary. S1.000. Jan 29 Recorded services provided on account for the period Jan 1-28. SI0.300. Jan 30 Received cash from clients for fees camed during period, Jan - 20. $5.000. Jan 31 Paid Staples for part of the debt incurred on Jan 21. SI 500 Feb 3 Paid part-time receptionist for two weeks' salary, S1.000. Feb 4 Paid cash for supplies, S800. Feb 6 Received cash from clients on account $4.500. Feb 8 Paid for January month of sclephone bill SISO. Feb 8 Pair for January month of utilities, 5500 Feb 17 Paid part-time receptionist for two weeks' salary. $1,000. Feb 28 Recorded services provided on account for the period Feb 1-28S8,500. Feb 28 Recorded cash from cash clients for fees earned for the period Feb 1-28, S4,500 Feb 28 Paid dividends. $8.000. Before preparing the financial statements, the following adjustments need to be made on Feb 28, 2018. Normally we do this for prepaid expenses, uneared revenue, accrued revenue, and accrued expense. In addition, we record depreciation for fixed assets other than land a) Insurance expired during January and February is $300 (S1,800/12*2) b) Supplies on hand on February 28 are $1.280 c) Depreciation of office equipment for January and February is S517 (S12,000+$3,500/60 * 2 months) d) Accrued receptionist salary on Feb 28 is $1000 e) Rent expired during January and February is S1.800 f) Uncamed fees on February 28 are $1.500 Prepare Adjusted Trial Balance. Prepare the Financial Statements Journalize and Posting Closing Entries. Prepare Post-Closing Trial Balance

Answer 1

40 Credit Date Account title & explanation 1-Jan Cash Accounts Receivable Supplies Office Equipment Common Stock Debit 15000 51000 2000 12000 80000 5400 1-Jan Prepaid Rent Cash 5400 1800 3-Jan Prepaid Insurance Cash 1800 5-Jan Cash 6000 Unearned Fees 6000 55 56 10-Jan Cash 500 57 Accounts Receivable 500 59 350 20-Jan Advertisement Expense Cash 60 350 61 62 63 3500 21-Jan Office Equipment Accounts Payable 3500

1000 21-Jan Salary Expense Cash 66 1000 67 10300 29-Jan Accounts Receivable Service Revenue 10300 30-Jan Cash 5000 Service Revenue 5000 1500 31-Jan Accounts Payable Cash 1500 1000 3-Feb Salary Expense Cash 78 1000 800 80 81 4-Feb Supplies Cash 800 82 6-Feb Cash 4500 Accounts Receivable 4500 85 86 150 8-Feb Telephone Bill Cash 87 150

500 8-Feb Utilities Expense Cash 500 1000 17-Feb Salary Expense Cash 1000 92 93 94 95 8500 28-Feb Accounts Receivable Service Revenue 96 8500 28-Feb Cash 4500 Service Revenue 4500 97 98 99 100 101 102 500 28-Feb Dividend Cash 500 103 Adjusting Entries 300 104 105 106 a 107 108 109 b Insurance expense Prepaid insurance 300 1,520 Supplies expense (2000+800 - 1280) Supplies 110 1,520 111 112 c 113 517 Depreciation Expense - Equipment Accumulated Depreciation - Equipment 517

115 d 1,000 Salaries Expense Salaries Payable 1,000 116 117 118 e 1800 Rent expense Prepaid Rent 1800 119 120 121 122 4500 Unearned Fees Service Revenue 4500 19