Question

Requirement #1: During its first month of operation, the Quick Tax Corporation, which specializes in tax preparation, completed the following transactions. July 1 Began business by making a deposit in a company bank account of $40,000, in exchange for 4,000 shares of $10 par value common stock July 3 Paid the current month's rent, $2,500 July 5 Paid the premium on a 1-year insurance policy, $3,600 July 7 Purchased supplies on account from Little Company, $700. July 10 Paid employee salaries, $2,800 July 14 Purchased equipment from Lake Company, $9,500. Paid $1,500 down and the balance was placed on account. Payments of $500 will be due until the balance is paid in full. The first payment is due 8/1. Note: Use accounts payable for the balance due. July 15 Received cash for preparing tax returns for the first half of July, $6,500 July 19 Made payment on account to Lake Company, $500. July 31 Received cash for preparing tax returns for the last half of July, $8,250 July 31 Declared and paid cash dividends of $450.

a) One month's insurance has expired.
b) The remaining inventory of supplies is $300.
c) The estimated depreciation on equipment is $125.
d) The estimated income taxes are $2700.

Requirements

1.Prepare the closing entries at July 31 in the general journal

2. Post the closing entries to the general ledger T-accounts and compute ending balances. Just add to the adjusted balances already listed.

Answer 1

Book1 - Microsoft Excel - X Home Insert Page Layout Formulas Data Review View Cut Copy - General 1 Wrap Text Merge & Center 1 - 3 LE Paste Format Painter Clipboard Autosum * Times New Rom - 12 - A A BI U - ->-A Font Conditional Format Formatting as Table Styles Cell Styles Insert Delete Format 2 Clear Sort & Find & Filter Select Editing Alignment Number Cells A Quick Tax Corporation 3 Date Credit Debit $ 40,000.00 General Journal 1-Jul Bank To Common Stock (Being business began by depostied amount in the Company's Bank against common stock) 40,000.00 $ 2,500.00 3-Jul Prepaid Rent To Cash (Being amount paid for current month rent) 2,500.00 $ 3.600.00 5-Jul Prepaid Insurance To Cash (Being amount paid for 1 year Insurance) 3.600.00 $ 700.00 17 7-Jul Supplies To Accounts Payable (Being amount of Supplies purchased on account from Little Company) 700.00 21 $ 2.800.00 10-Jul Salaries 22 1 To Cash Ke Sheet1 Sheet2 Sheet30 Select destination and press ENTER or choose Paste 2800.00 Average: 10517.55705 Count: 390 Sum: 1567116 B OU 100% 0 + g A OENG 20:03a 01-02-2020

Book1 - Microsoft Excel - X Home Insert Page Layout Formulas Data Review View Cut Copy - General 1 Wrap Text Merge & Center 1 - 3 LE Paste Format Painter Clipboard Autosum * Times New Rom - 12 - A A BI U - ->-A Font Conditional Format Formatting as Table Styles Cell Styles Insert Delete Format 2 Clear Sort & Find & Filter Select Editing Alignment Number Cells Α1 S 2.800.00 10-Jul Salaries To Cash (Being amount paid for Employees Salaries) 2.800.00 S 9,500.00 1,500.00 8,000.00 14-Jull Equipment To Cash To Accounts Payable (Being amount of Equipment Purchased by paying $1500 cash and balance on account) 15-Jul Cash To Service Revenue (Being amount received for preparing tax returns) 6,500.00 6,500.00 S 500.00 19-Jul Accounts Payable To Cash (Being amount paid to Lake Company) S 500.00 S 8.250.00 31-Jul Cash To Service Revenue (Being amount received for preparing tax returns) 8,250.00 40 41 S 450.00 31-Jull Dividend | To Cash Sheet1 Sheet2 450.00 Sheet3 0 Ready Average: 10517.55705 Count: 390 Sum: 1567116 B OU 100% + 0 20:03 01-02-2020 g A OENG " W

Book1 - Microsoft Excel - X Home Insert Page Layout Formulas Data Review View Cut Copy - General Wrap Text Merge & Center 1 1 - 3 Autosum * Times New Rom - 12 - A A BI U - ->-A Font Paste Insert Delete Format Conditional Format Formatting as Table Styles Format Painter Clipboard Cell Styles 2 Clear Sort & Find & Filter Select Editing Alignment Number Cells Α1 S 450.00 42 31-Jul Dividend To Cash Being amount of Dividend Paid) 450.00 47 48 Date 49 Adjusting Journal Entries General Journal Debit Credit $ 300.00 31-Jul Insurance Expenses=($3600/12) To Prepaid Insurance (Being amount of one month Insurance Expired) 300.00 S 400.00 31-Jul Supplies Expense($700-$300) To Supplies (Being amount of Supplies Expense) 400.00 S 125.00 31-Jul Depreciation Expense To Accumulated Depreciation (Being amount of Depreciation Expense) 125.00 61 62 $ 2,500.00 31-Jul Rent Expense I To Drenaid Rent Sheet1 Sheet2 Sheet3 62 2.500.00 Ready Average: 10517.55705 Count: 390 Sum: 1567116 B OU 100% 0 + 20:04 g A O ENG 01-02-2020

Book1 - Microsoft Excel - X Home Insert Page Layout Formulas Data Review View Cut Copy - General Times New Rom - 12 - A A BI U - ->-A Font Wrap Text Merge & Center Paste Insert Delete Format Conditional Format Formatting as Table Styles Format Painter Clipboard Cell Styles 2 Clear Sort & Find & Filter Select Editing Alignment Number Cells Α1 for S 125.00 31-Jul Depreciation Expense To Accumulated Depreciation (Being amount of Depreciation Expense) 125.00 $ 2,500.00 31-Jull Rent Expense To Prepaid Rent Being amount of Rent Expense) 2,500.00 $ 2,700.00 31-Jull Income Tax To Income Tax Payable (Being amount of Income Tax Expense) 2,700.00 To Common Stock To Service Revenue To Service Revenue Bank or Cash $ 40,000.00 By Prepaid Rent $ 6,500.00 By Prepaid Insurance $ 8.250.00 By Salaries By Equipment By Accounts Payable By Dividend By Balance Cld S S S S $ 2,500.00 3.600.00 2.800.00 1,500.00 500.00 450.00 43,400.00 79 Total $ 54.750.00 Total S 54,750.00 ** Ready Sheet1 Sheet2 Sheet3 Average: 10517.55705 Count: 390 Sum: 1567116 B OU 100% 0 + 20:04 g A OENG 01-02-2020

Book1 - Microsoft Excel - X Home Insert Page Layout Formulas Data Review View Cut Copy - General LE Paste Format Painter Clipboard Times New Rom - 12 - A A BI U - ->-A Font Wrap Text Merge & Center 99 % , od. 1 D Conditional Format sociale . 3 Insert Delete Format AutoSum" AT A Clear sort le Find & Conditional Format Formatting as Table Styles Cell Styles Insert Delete Format 2 Clear Sort & Find & Filter Select Editing Alignment Number Cells A 81 82 Particular To Income Summary Account Service Revenue Amount Particular $ 14,750.00 By Cash By Cash Amount $ 6,500.00 $ 8,250.00 Total S 14,750.00 Total S 14,750.00 Common Stock Amount Particular Particular By Bank By Income Summary Amount $ 40,000.00 Total Particular To Cash Total Prepaid Rent Amount Particular $ 2,500.00 By Rent Account S 2,500.00 Total Amount $ 2,500.00 S 2,500.00 Supplies 101 102 Amount Particular Amount Particular Sheet1 Sheet2 K Sheet3 Ready Average: 10517.55705 Count: 390 Sum: 1567116 B OU 100% 0 + g A O ENG 20:04 01-02-2020 o

Book1 - Microsoft Excel - X Home Insert Page Layout Formulas Data Review View Cut Copy - General Times New Rom - 12 - A A BI U - ->-A Font Wrap Text Merge & Center Paste 1 1 - 3 conditional es podem ser insert Delete Format ... Autosum * 2 clear the 8 9 Format Painter Clipboard Insert Delete Format Conditional Format Formatting as Table Styles Cell Styles 2 Clear Sort & Filter Editing Find & Select Finde Alignment Number Cells A1 А Particular To Cash Prepaid Rent Amount Particular S 2,500.00 By Rent Account S 2,500.00 Total 98 Amount $ 2,500.00 $ 2,500.00 Total Supplies Particular To Accounts Payable Amount Particular S 700.00 By Supplies Expense By Balance Cld $ 700.00 Total Amount 400.00 S 300.00 $ 700.00 Total 208 109 Particular To Cash To Balance Cla Total Accounts Payable Amount Particular $ 500.00 By Supplies S 8,200.00 By Equipment $ 8.700.00 Total 110 Amount $ 700.00 $ 8.000.00 S 8.700.00 112 113 114 Particular To Cash Prepaid Insurance Amount Particular $ 3,600.00 By Insurance Expense By Balance cd 115 Amount S 300.00 $ 3,300.00 116 117 HE Ready Sheet1 Sheet2 Sheet3 I Average: 10517.55705 Count: 390 Sum: 1567116 B OU 100% + 0 20:04 01-02-2020 g A O ENG W

Book1 - Microsoft Excel - X Home Insert Page Layout Formulas Data Review View Cut Copy - General Times New Rom - 12 - A A BI U - ->-A Font Wrap Text Merge & Center 1 1 - 3 completion of promote the sense Insert Delete Format Paste Autosum * 2 clear 8-92 Format Painter Clipboard Insert Delete Format Conditional Format Formatting as Table Styles Cell Styles 2 Clear Sort & Filter Editing time Find & Select Alignment Number Cells A1 A 120 121 122 123 124 125 126 Particular To Cash To Accounts Payable Total Equipment Amount Particular $ 1,500.00 By Cash S 8,000.00 $ 9,500.00 Amount $ 9,500.00 S 9,500.00 Particular To Cash Total Salaries Expense Amount Particular $ 2,800.00 By Income Summary $ 2.800.00 Amount S 2.800.00 S 2,800.00 Particular To Prepaid Rent Rent Expense Amount Particular $ 2.500.00 By Income Summary Amount S 2,500.00 Total S 2,500.00 S 2,500.00 140 141 K Ready Particular To Prepaid Insurance Total Sheet1 Sheet2 Sheet3 Insurance Expense Amount Particular S 300.00 By Income Summary S 300.00 Amount S 300.00 $ 300.00 Average: 10517.55705 Count: 390 Sum: 1567116 BO U 100% 0- 20:04 g A O ENG 01-02-2020

Book1 - Microsoft Excel - X Home Insert Page Layout Formulas Data Review View Cut Copy - General Wrap Text Merge & Center 1 1 - 3 Autosum * Times New Rom - 12 - A A BI U - ->-A Font Paste Insert Delete Format Conditional Format Formatting as Table Styles Cell Styles Format Painter Clipboard 2 Clear Sort & Filter Editing Find & Select Alignment Number Cells A1 ТАА 143 144 Particular To Supplies Supplies Expense Amount Particular $ 400.00 By Income Summary Amount S 400.00 145 146 147 148 Total S 400.00 S 400.00 Dividend Particular To Cash Amount Particular $ 450.00 By Retained Earnings Amount S 450.00 Total IS 450.00 S 450.00 Particular To Accumulated Depreciation Depreciation Expense Amount Particular $ 125.00 By Income Summary Amount S 125.00 Total S 125. 00 S 125.00 Particular To Income Tax Payable Income Tax Expense Amount Particular $ 2,700.00 By Income Summary Amount S 2.700.00 163 164 Sheet1 Sheet2 Sheet3 Ready Average: 10517.55705 Count: 390 Sum: 1567116 B OU 100% + 0 20:04 01-02-2020 g A O ENG

Book1 - Microsoft Excel - X Home Insert Page Layout Formulas Data Review View Cut Copy - General Times New Rom - 12 - A A BI U - ->-A Font Wrap Text Merge & Center 1 1 Conditional Format cu - 3 insert Delete Format Autosum * 2 Clear store Paste Insert Delete Format Conditional Format Formatting as Table Styles Cell Styles Format Painter Clipboard 2 Clear Sort & Find & Filter Select Editing Alignment Number Cells A1 А 167 168 C D Income Tax Payable Amount Particular $ 2,700.00 By Income Tax Particular To Balance Cld Amount $ 2,700.00 169 170 Total S 2,700.00 $ 2,700.00 Particular To Balance Cld Accumulated Depreciation Amount Particular $ 125.00 By Depreciation Amount S 125.00 Total S 125.00 S 125.00 Post Closing Entries General Journal Credit Debit 14,750.00 $ Service Revenue To Income Summary 14,750.00 184 S 8.825.00 186 187 Income Summary To Supplies To Salaries Expense To Rent Expense Sheet1 Sheet2 Sheet3 400.00 2,800.00 2,500.00 188 » Ready Average: 10517.55705 Count: 390 Sum: 1567116 B OU 100% ve gAAD ENG 0 20:04 01-02-2020 + .

Book1 - Microsoft Excel - X Home Insert Page Layout Formulas Data Review View Cut Copy - General 1 Wrap Text Merge & Center 1 - 3 LE Paste Format Painter Clipboard Autosum * Times New Rom - 12 - A A BI U - ->-A Font Conditional Format Formatting as Table Styles Cell Styles Insert Delete Format 2 Clear Sort & Find & Filter Select Editing Alignment Number Cells A1 fix Post Closing Entries 179 180 General Journal Credit $ Debit 14,750.00 Service Revenue To Income Summary 14.750.00 184 185 $ 8.825.00 186 187 Income Summary To Supplies To Salaries Expense To Rent Expense To Insurance Expense To Depreciation Expense To Income Tax Expense 400.00 2.800.00 2,500.00 300.00 125.00 2,700.00 S 5,925.00 Income Summary To Retained Earnings 5,925.00 196 Retained Earnings | To Dividend Paid S 450.00 197 450.00 198 199 200 Quick Tax Corporation Post Closing Trial Balance Trial Balauro 2011 Sheet1 Sheet2 Sheet3 Ready Average: 10517.55705 Count: 390 Sum: 1567116 B OU 100% 0 + 20:04 g A O ENG 01-02-2020

Book1 - Microsoft Excel - X Home Insert Page Layout Formulas Data Review View Cut Copy - General 1 Wrap Text Merge & Center 1 - 3 LE Paste Format Painter Clipboard Autosum * Times New Rom - 12 - A A BI U - ->-A Font Conditional Format Formatting as Table Styles Cell Styles Insert Delete Format 2 Clear Sort & Find & Filter Select Editing Alignment Number Cells A1 $ 5,925.00 192 193 194 195 Income Summary To Retained Earnings 5,925.00 196 S 450.00 Retained Earnings | To Dividend Paid 197 450.00 Quick Tax Corporation Post Closing Trial Balance Trial Balance Credit 203 204 Debit $ 43,400.00 $ 3,300.00 $ 300.00 $ 9,500.00 Account Title Cash Prepaid Insurance Supplies Equipment Accounts Payable Income Tax Payable Accumulated Depreciation Equipment Common Stock Retained Earnings($5925-$450) Total 208 8,200.00 2.700.00 125.00 40,000.00 5,475.00 56,500.00 211 S 56,500.00 S 212 213 1 Ready Sheet1 Sheet2 Sheet3 Average: 10517.55705 Count: 390 Sum: 1567116 B OU 100% + 0 20:04 01-02-2020 g A O ENG