Question

Problem 2-2A pages 74-75. Complete the following: A) Create a set of t-accounts from the accounts listed in Step 2 B) Record the transactions in a general journal (use a chart also if that helps you) C) Post the transactions to t-accounts D) Calculate ending balance for each t-account E) Prepare a trial balance F) Prepare and Income Statement, Statement of Owner's Equity, and Balance Sheet Problem 2-2A Preparing and posting journal entries, preparing a tiel balance ac Arical Engineering completed the following transactions in the mouth of June. a.Jenna Aracel, the owner, invested $100.000 cash, office equipment with a value of $5.000, and 60,000 of drasting equipment to launch the company b. The company purchased land worth $49.000 for an office by paying 36.300 cash and signing a long term note payable for $42.700 c. The company purchased a portable building with $55.000 cash and moved it onto the land acquired in b. d. The company paid $3.000 cash for the premium ceans-month insurance policy. e. The company completed and delivered a set of plans for a client and collected $6.000 cash 1. The company purchased $20.00 ed additional drafting equipment by pesing 89.300 cash and signing long-term note pasable for Sogoo Pas The company completed $14,000 of engineering services for a client. This amount is to be received in go days h. The company purchased $1.450 of additional lice equipment on credit 1. The company completed engineering services for con credit J. The company received a bill for rent of equipment that was used on a y completed job. The $1.333 etcost must be paid within go days. k. The company collected $7.000 cash in partial payment from the client described in transactions 1. The company paid $1.000 cash for wage to a drafting wat m. The company paid $1,150 cash to settle the account payable created in transaction 1. The company paid ag cash for minor maintenance of its drafting equipment o. Jasa Arace with $9.480 cash from the company for personal use. p. The company paid $1,200 cash for wages to a drafting assistant 4. The company paid Sagoo cash for advertisements on the web during June Required 1. Prepare gal journal entries to read these transactions (use the account title isted in part) 2. Open the following ledger accounts-their account numbers are in partes use the balance column format: Cash (204)Accounts Receivable (106). Prepaid Insurance (108) Office Equipment Cust Drafting Equipment (6Building (10Land Accounts Payable (Otes Payable Lagoa Aracel Capital (900): J.Aracel, Withdrawals (goal Engineering Fees Eased Coal Wages Expo Equipment Rental Expense (602): Advertising Expense (Gogland Repairs Expense (604). Post the joumal entries from parts to the accounts and enter the balance after each posting 3. Prepare a trial balance of the end of Ju.

A) Create a set of t-accounts from the accounts listed in Step 2

B) Record the transactions in a general journal (use a chart also if that helps you)

C) Post the transactions to t-accounts

D) Calculate ending balance for each t-account

E) Prepare a trial balance

F) Prepare and Income Statement, Statement of Owner's Equity, and Balance Sheet

Answer 1

1. Journal Entries -

Date a Aracel Engineering Journal Entries Accounts Title Debit Credit Cash $ 100,000 Office Equipments $ 5,000 Drafting Equipments $ 60,000 Jenna Aracel, Capital $ 165,000 (Being Cash and office eqiupments introduced) b Land $ 49,000 Notes Payable (Long Term) Cash (Being Land purchased) $ 42,700 $ 6,300 с Building $ 55,000 Cash (Being Portable building purchased) $ 55,000 d Prepaid Insurance $ 3,000 Cash (Being insurance paid for 18 months) $ 3,000 e Cash $ 6,200 Engineering Fees Earned (Being Fees Earned) $ 6,200 f Drafting Equipments $ 20,000 Cash Notes Payable (Long Term) (Being drafting equipment purchased) $ 9,500 $ 10,500 Accounts Receivable $ 14,000 Engineering Fees Earned (Being Fees Earned on account) $ 14,000 h Office Equipment $ 1,150 Accounts Payable $ 1,150 (Being Office equipment purchased on account) i Accounts Receivable $ 22,000 Engineering Fees Earned (Being Fees Earned on account) $ 22,000 j Equipment rental Expenses $ 1,333 Accounts Payable $ 1,333 (Being Rental Expense on equipment incurred) k Cash $ 7,000 Accounts Receivable (Being payment received on account) $ 7,000 1 $ 1,200 Wages Expense Cash (Being Wages Paid) $ 1,200 m Accounts Payable $ 1,150 Cash (Being payment made on account) $ 1,150 n Repair Expense $ 925 Cash (Being minor repair expense incurred) $ 925 o Jenna Aracel, Withdrawal $ 9,480 Cash (Being Cash withdrawl for personal use) $ 9,480 p Wages Expense $ 1,200 Cash $ 1,200 (Being Wages Paid) q Advertising Expense $ 2,500 Cash $ 2,500 (Being Advertising Expense paid)

2. Ledgers -

a b Notes Payable (Long Term) $ 42,700 $ 10,500 b e с f k d f cl Bal $ 53,200 Cash $ 100,000 $ 6,300 $ 6,200 $ 55,000 $ 7,000 $3,000 $ 9,500 $ 1,200 $ 1,150 $ 925 $ 9,480 $ 1,200 $ 2,500 I m n Jenna Aracel, Capital $ 165,000 o a p q cl Bal $ 165,000 cl Bal $ 22,945 Jenna Aracel, Withdrawal $ 9,480 $113,200 $113,200 o cl Bal $ 9,480 Prepaid Insurance $ 3,000 d Cl Bal $ 3,000 e Engineering Fees Earned $ 6,200 $ 14,000 $ 22,000 g i Accounts Receivable $ 14,000$ 7,000 $ 22,000 k cl Bal $ 42,200 i Cl Bal $ 29,000 Equipment rental Expenses $ 1,333 j Land Cl Bal $ 1,333 b $ 49,000 Cl Bal $ 49,000 1 р Wages Expense $ 1,200 $ 1,200 Building $ 55,000 C cl Bal $ 2,400 cl Bal $ 55,000 Repair Expense 925 n $ cl Bal $ 925 a h Office Equipments $ 5,000 $ 1,150 cl Bal $ 6,150 Advertising Expense $ 2,500 q cl Bal $ 2,500 a f Drafting Equipments $ 60,000 $ 20,000 cl Bal $ 80,000 m Accounts Payable $ 1,150 $ 1,150 $ 1,333 h j Cl Bal $ 1,333

3. Trial Balance -

Credit Aracel Engineering Trial Balance June 30 Accounts Title Debit Cash $ 22,945 Prepaid Insurance $ 3,000 Accounts Receivable $ 29,000 Land $ 49,000 Building $ 55,000 Office Equipments $ 6,150 Drafting Equipments $ 80,000 Accounts Payable Notes Payable (Long Term) Jenna Aracel, Capital Jenna Aracel, Withdrawal $ 9,480 Engineering Fees Earned Equipment rental Expenses $ 1,333 Wages Expense $ 2,400 Repair Expense $ 925 Advertising Expense $ 2,500 $ 1,333 $ 53,200 $ 165,000 $ 42,200 Total $ 261,733 $261,733

4. Income Statement -

Aracel Engineering Income Statement June 30 Engineering Fees Earned $ 42,200 Expenses: Equipment rental Expenses Wages Expense Repair Expense Advertising Expense Total Expenses $ 1,333 $ 2,400 $ 925 $ 2,500 $ 7,158 Net Earnings $ 35,042

5. Statement of Owner's Equity -

Aracel Engineering Statement of Owner's Equity June 30 Jenna Aracel, Capital $ 165,000 Add: Net Earnings $ 35,042 Jenna Aracel, Withdrawal $ (9,480) $ 25,562 Total Owner's Equity $190,562

6. Balance Sheet -

Aracel Engineering Balance Sheet June 30 Assets Current Assets: Cash $ 22,945 Prepaid Insurance $ 3,000 Accounts Receivable $ 29,000 Total Current Assets $ 54,945 Land Building Office Equipments Drafting Equipments $ 49,000 $ 55,000 $ 6,150 $ 80,000 Total Assets $ 245,095 Liabilities and Owner's Equity Current Liabilties: Accounts Payable $ 1,333 Notes Payable (Long Term) $ 53,200 Total Liabilities $ 54,533 Owner's Equity: Jenna Aracel, Capital $ 190,562 Total Liabilities and Owner's Equity $ 245,095