Question

Ricky's Piano Rebuilding Company has been operating for one year. On January 1, at the start of its second year, its income statement accounts had zero balances and its balance sheet account balances were as follows: Cash Accounts Receivable Supplies Equipment Land Buildings S 6,000 Accounts Payable Deferred Revenue (deposits) Notes Payable (long-term) Common Stock Retained Earnings $ 8,000 3,200 40,000 8,000 9,000 25,000 8.000 6,000 22,000 Required 1. Create T-accounts for the balance sheet accounts and for these additional accounts: Service Revenue, Rent Revenue, Salaries and Wages Expense, and Utilities Expense. Enter the beginning balances. (If you are using the general ledger tool in Connect, this requirement will be completed for you.) 2. Prepare journal entries for the following January transactions, using the letter of each transaction as a reference: a. Received a $500 deposit from a customer who wanted her piano rebuilt in February. b. Rented a part of the building to a bicycle repair shop: $300 rent received for January c. Delivered five rebuilt pianos to customers who paid $14,500 in cash. d. Delivered two rebuilt pianos to customers for $7,000 charged on account. e. Received $6,000 from customers as payment on their accounts f. Received an electric and gas utility bill for $350 for January services to be paid in February. g. Ordered $800 in supplies. h. Paid $1,700 on account in January i. Paid $10,000 in wages to employees in January for work done this month j. Received and paid cash for the supplies in (g). 3. Post the journal entries to the T-accounts. Show the unadjusted ending balances in the T 4. Use the balances in the completed T-accounts to prepare an unadjusted trial balance at January 31. (If you are 5. Using the unadjusted balances, prepare a preliminary income statement and classified balance sheet for the Page 137 accounts. (If you are using the general ledger tool, this requirement will be completed for you.) using the general ledger tool, this requirement will be completed for you.) month ended and at January 31

Answer 1