Question

PB3-3 Analyzing the Effects of Transactions Using T-Accounts, Preparing an Unadjusted Trial Balance, and Determining Net Income and Net Profit Margin (LO 3-1, LO 3-2, LO 3-3, LO 3-4, LO 3-5] (General Ledger) Jessica Pothier opened FunFlatables on June 1. The company rents out moon walks and inflatable slides for parties and corporate events. The company also has obtained the use of an abandoned ice rink located in a local shopping mall, where its rental products are displayed and available for casual hourly rental by mall patrons. The following transactions occurred during the first month of operations. a. Jessica contributed $42,000 cash to the company on June 1 in exchange for its common stock. b. Purchased inflatable rides and inflation equipment on June 2, paying $26,550 cash. c. Received $9,200 cash from casual hourly rentals at the mall on June 3. d. Rented rides and equipment to customers for $11,150. Received cash of $4,800 on June 4 and the rest is due from customers. e. Received $5,200 from a large corporate customer on June 5 as a deposit on a party booking for July 4. f. Began to prepare for the July 4 party by purchasing and receiving various party supplies on June 6 on account for $860. g. On June 7, paid $10,150 in cash for renting the mall space this month. h. On June 8, prepaid next month's mall space rental charge of $10,150. I. Received $1,800 on June 9 from customers on accounts receivable. j. Paid $2,800 for running a television ad on June 10. k. Paid $5,000 in wages to employees on June 30 for work done during the month. General Ledger General Analysis Trial Balance Requirement Journal General Journal tab - Prepare the journal entries to record the transactions (a) through (k). Review the accounts as shown in the General Ledger and Trial Balance tabs. General Ledger tab - Each journal entry is posted automatically to the general ledger. Trial Balance tab - The ending balance values from the General Ledger tab flows through to the Trial Balance tab. Analysis tab - Using the information from the requirements above, complete the 'Analysis' tab. General Journal> Requirement

Answer 1

Journal Entries:

	Date	Account title and explanation	Debit	Credit
a	June 1	Cash	$42,000
		Common stock		$42,000
		[To record issuance of common stock for cash]
b	June 2	Equipment	$26,550
		Cash		$26,550
		[To record purchase of equipment for cash]
c	June 3	Cash	$9,200
		Rent revenue		$9,200
		[To record service revenue]
d	June 4	Cash	$4,800
		Accounts receivable	$6,350
		Rent revenue		$11,150
		[To record services performed for cash and on account]
e	June 5	Cash	$5,200
		Deferred rent revenue		$5,200
		[To record cash received in advance form customers]
f	June 6	Supplies	$860
		Accounts payable		$860
		[To record purchased supplies on account]
g	June 7	Rent expense	$10,150
		Cash		$10,150
		[To record rent expense]
h	June 8	Prepaid rent	$10,150
		Cash		$10,150
		[To record rent paid in advance]
i	June 9	Cash	$1,800
		Accounts receivable		$1,800
		[To record collections from customers]
j	June 10	Advertising expense	$2,800
		Cash		$2,800
		[To record advertising expense]
k	June 30	Wages expense	$5,000
		Cash		$5,000
		[To record wages expense]

Ledger:

Cash					Common stock
June 1	$42,000	June 2	$26,550				June 1	$42,000
June 3	$9,200	June 7	$10,150				Bal.	$42,000
June 4	$4,800	June 8	$10,150
June 5	$5,200	June 10	$2,800		Accounts payable
June 9	$1,800	June 30	$5,000				June 6	$860
Bal.	$8,350						Bal.	$860
Supplies					Deferred rent revenue
June 6	$860						June 5	$5,200
Bal.	$860						Bal.	$5,200
Prepaid rent					Rent revenue
June 8	$10,150						June 3	$9,200
Bal.	$10,150						June 4	$11,150
							Bal.	$20,350
Accounts receivable
June 4	$6,350	June 9	$1,800		Rent expense
Bal.	$4,550				June 7	$10,150
					Bal.	$10,150
Equipment					Advertising expense
June 2	$26,550				June 10	$2,800
Bal.	$26,550				Bal.	$2,800
					Wages expense
					June 30	$5,000
					Bal.	$5,000

Trial Balance:

Unadjusted Trial balance
For the month ended June 30
Account title	Debit	Credit
Cash	$8,350
Supplies	$860
Prepaid rent	$10,150
Accounts receivable	$4,550
Equipment	$26,550
Common stock		$42,000
Accounts payable		$860
Deferred rent revenue		$5,200
Rent revenue		$20,350
Rent expense	$10,150
Advertising expense	$2,800
Wages expense	$5,000
Total	$68,410	$68,410