Question

Accounting Cycle Review 4-1 (Part Level Submission) On August 1, 2018, the beginning of its current fiscal year, the following opening account balances, listed in alphabetical order, were reported by Tobique Ltd. Accounts payable Accounts receivable Accumulated depreciation equipment Cash Common shares Equipment $2,490 Interest receivable 4,590 Note receivable, due October 31, 2018 1,850 Retained earnings 5,650 Salaries payable 11,400 Supplies 9,100 Unearned revenue 20 4,000 5,950 1,510 1,060 1,220 During August, the following summary transactions were completed. Paid $360 cash for advertising in local newspapers. Advertising flyers will be included with newspapers delivered during August and September. Aug. 1 (Hint: Use the Prepaid Advertising account.) 3 Paid August rent $340. (Hint: Use the Prepaid Rent account.) 6 Received $3,120 cash from customers in payment of accounts. 10 Paid $3,390 for salaries due employees, of which $1,880 is for August and $1,510 is for July salaries payable. 13 Received $3,620 cash for services performed in August. 15 Purchased additional equipment on account $2,010. 17 Paid creditors $2,010 of accounts payable due. 22 Purchased supplies on account $780. 24 Paid salaries $2,640. 27 Performed services worth $4,590 on account and billed customers. 29 Received $830 from customers for services to be provided in the future. 31 Declared and paid a $530 dividend.

Answer 1

The answer has been presented in the supporting sheet. For detailed answer refer to the supporting sheet.

1 Answer 2 Credit 4 180 5 180 6 340 340 8 1470 1470 185 185 820 3 Date Account Title and Explanation Debit 1 Aug. 31 Advertising expense (360/2) Prepaid advertising 2 Aug. 31 Rent expense 7 Prepaid rent 3 Aug. 31 Salaries expense 9 Salaries Payable 10 4 Aug. 31 Depreciaton expense 11 Accumulated depreciation - equipment 12 5 Aug. 31 Supplies expense (1060+780-1020) 13 Supplies 14 6 Aug. 31 Unearned revenue 15 Service revenue 16 7 Aug. 31 Interest receivable (4000*6%*1/12) 17 Interest revenue 18 8 Aug. 31 Income tax expense 19 Income taxes payable 20 21 For any other help please comment in the comment box 22 Thank you 820 720 720 20 20 300 300 22