Question

Roth Contractors Corporation was incorporated on December 1, 2019. Required. Part A 1 Prepare journal entries to record the December transactions shown on page "Transactions Pt. A". General ledger account numbers and descriptions are not needed. 2 Post the entries to general ledger T-accounts. Part B Prepare all necessary adjusting entries based on the information shown on the printed "Adj. Entries Pt. B" page. General ledger account numbers and descriptions are not necessary. 4 Post the entries to general ledger T-accounts and calculate balances. 5 Prepare an adjusted trial balance at December 31. 6 Prepare an income statement, statement of changes in equity, and balance sheet. Assume the fiscal year-end is December 31, 2019. 7 Prepare closing entries and a post-closing trial balance at December 31, 2019.

Answer 1

Prepare journal entries as follows: Credit No a. Account name and explanation Cash Capital stock Debit $2,000 $2,000 0 Prepaid rent $2,400 Cash $2,400 C. Truck $13,000 Accounts payable $13,000 d $1,600 Supplies expense To accounts payable $1,600 e $2,280 Prepaid insurance Cash $2,280 f $6,000 Accounts receivable Service revenue $6,000 Cash $4,000 Service revenue $4,000 Advertising expense Interest expense Telephone expense Truck operating expense Wages expense Cash $700 $700 $800 $600 $5,000 $7,800 Cash $1,000 Accounts receivable $1,000 j 57.000 Accounts receivable Service revenue $7,000 k No entry Advertising expense Interest expense Truck operating expense Wages expense Cash $600 $600 $900 $2,000 $4,100 m Cash $2.000 Service revenue $2,000 n $800 Utilities expense Accounts payable $800

Prepare adjusting entries as follows: Credit No O Account name and explanation Insurance expense Prepaid insurance Debit $190 $190 P $800 Rent expense Prepaid rent $800 q $100 Unused supplies Supplies expense $100 $2,000 Service revenue Unearned revenue $2,000 S $2,900 Wages expense Wages payable $2,900 $361 Depreciation expense Accumulated depreciation $361 u $100 Income tax expense Income tax payable $100 Prepare the T-accounts as follows: Cash: Cash $2.000 $4.000 $1,000 $2,000 $5,000 $2.400 $2,280 $700 $700 $800 $600 S600 $600 $900 $2.000 -$7,580

Capital stock: Capital Stock 2000 Prepaid rent: Prepaid rent 2400 2400 Truck: Truck 13000 Accounts payable: Accounts payable $13,000 $1,600 $800 $15.400 Supplies expense: Supplies expense Dr $100 $1,600 $1,500

Prepaid insurance: Prepaid insurance $190 $2.280 $2,090 Accounts receivable: Accounts receivable $1,000 $6,000 $7,000 $12.000 Service revenue: Service revenue $2,000 $6,000 $4,000 $7,000 $2.000 $17,000 10 Advertising expense: Advertising expense $700 $600 $1,300

11. Interest expense: Interest expense $700 $600 $1,300 12. Telephone expense: Telephone expense $800 Truck operating expense: Truck operating expense $600 $900 $1,500 14. Wages expense: Wages expense $5,000 $2,000 $2,900 $9.900 15. Utilities expense: Utilities expense $800

16. Insurance expense: Insurance expense $190 17. Rent expense: Rent expense DI S800 18. Unused supplies: Unused supplies $100 19. Unearned revenue: Unearned revenue Dr $2,000 20. Wages payable: Wages payable $2.900 Depreciation expense: Depreciation expense $361

22. Accumulated depreciation: Accumulaed depreciation DE $361 23. Income tax expense: Income tax expense Dr L $100 Income tax payable: Income tax payable Cr $100

Prepare adjusted trial balance as follows: Credit $7,580 Adjusted trial balance Particulars Debit Cash Accounts receivable $12,000 Unused supplies $100 Prepaid insurance $2.090 Prepaid rent $1,600 Truck $13,000 Accumulated depreciation Accounts payable Wages payable Unearned revenue Income tax payable Capital stock Service revenue Supplies expense $1.500 Advertising expense $1,300 Interest expense $1,300 Telephone expense $800 Truck operating expense $1,500 Wages expense $9.900 Utilities expense Insurance expense $190 Rent expense $800 Depreciation expense $361 Income tax expense $100 $47,341 $361 $15,400 $2,900 $2,000 $100 $2,000 $17,000 $800 347,341

Prepare income statement as follows: $17,000 Income statement Service revenue Less: Supplies expense Advertising expense Interest expense Telephone expense Truck operating expense Wages expense Utilities expense Insurance expense Rent expense Depreciation expense Income tax expense Net loss -$1,500 -$1,300 -$1,300 -$800 -$1,500 -$9.900 -$800 -$190 -$800 -$361 -$100 -$1,551 Prepare statement of changes in equity as follows: Statement of changes in equity Beginning equity Less:Net loss Less Dividends Ending equity SO -$1,551 $1,551

Prepare balance sheet as follows: Balance Sheet Assets Current assets: Cash Accounts receivable Unused supplies Prepaid insurance Prepaid rent Total current assets Long term assets: Truck Less Accumulated depreciation Total long term assets Total assets -$7,580 $12,000 $100 $2,090 $1,600 $8,210 $13,000 -$361 $12.639 $20.849 $15,400 $2.900 $2,000 $100 Liabilities & Equity Current liabilities: Accounts payable Wages payable Unearned revenue Income tax payable Total Current liabilities Equity Capital stock Retained earnings Total equity Total liabilities & equity $20,400 $2,000 -$1,551 $449 $20,849

Prepare closing entries as follows: Credit No 1 Account name and explanation Retained earnings Service revenue Debit $17,000 $17,000 Supplies expense Advertising expense Interest expense Telephone expense Truck operating expense Wages expense Utilities expense Insurance expense Rent expense Depreciation expense Income tax expense Retained earnings $1,500 $1,300 $1,300 $800 $1,500 $9.900 $800 $190 $800 $361 $100 $18,551 Prepare post-closing trial balance as follows: Credit $7,580 Post closing trial balance Particulars Debit Cash Accounts receivable $12,000 Unused supplies $100 Prepaid insurance $2,090 Prepaid rent $1,600 Truck $13,000 Less Accumulated depreciation Accounts payable Wages payable Unearned revenue Income tax payable Capital stock Retained earnings $1,551 $30,341 $361 $15,400 $2,900 $2,000 $100 $2,000 $30,341