The trial balance of Pacilio Security Services Inc. as of January 1, 2015, had the following normal
Question:
The trial balance of Pacilio Security Services Inc. as of January 1, 2015, had the following normal balances:
During 2015, Pacilio Security Services experienced the following transactions:
1. Paid the salaries payable from 2014.
2. On January 15 , purchased 20 standard alarm systems for cash at a cost of \(\$ 250\) each.
3. On February 1, paid the accounts payable of \(\$ 980\), but not within the discount period. (The company uses the gross method.)
4. On March 1 , leased a business van. Paid \(\$ 4,800\) for one year's lease in advance.
5. Paid \(\$ 7,200\) on May 1 for one year's rent on the office in advance.
6. Purchased with cash \(\$ 500\) of supplies to be used over the next several months by the business.
7. Purchased with cash another 25 alarm systems on August 1 for resale at a cost of \(\$ 260\) each.
8. On September 5, purchased on account 30 standard alarm systems at a cost of \(\$ 265\).
9. Installed 60 standard alarm systems for \(\$ 33,000\). \(\$ 22,000\) of the sales were on account and \(\$ 11,000\) were cash sales. (Note; Be sure to record cost of goods sold using the perpetual FIFO method.)
10. Made a full refund to a dissatisfied customer who returned her alarm system. The sale had been a cash sale for \(\$ 550\) with a cost of \(\$ 260\).
11. Paid installers and other employees a total of \(\$ 21,000\) cash for salaries.
12. Sold \(\$ 45,000\) of monitoring services during the year. The services are billed to the customers each month.
13. Sold an additional monitoring service for \(\$ 1,200\) for one year's service. The customer paid the full amount of \(\$ 1,200\) on October 1 .
14. Collected \(\$ 74,000\) of accounts receivable during the year.
15. Paid an additional \(\$ 6,000\) to settle some of the accounts payable.
16. Paid \(\$ 3,500\) of advertising expense during the year.
17. Paid \(\$ 2,320\) of utilities expense for the year.
18. Paid a dividend of \(\$ 15,000\) to the shareholders.
Adjustments
19. There was \(\$ 200\) of supplies on hand at the end of the year.
20. Recognized the expired rent for both the van and the office building for the year.
21. Recognized the revenue earned from transaction 13.
22. Accrued salaries at December 31,2015 , were \(\$ 1,000\).
Required
a. Record the above transactions in general journal form.
b. Post the transactions to T-accounts.
c. Prepare a trial balance.
d. Prepare an income statement, statement of changes in stockholders' equity, balance sheet, and statement of cash flows.
e. Close the temporary accounts to retained earnings.
f. Post the closing entries to the \(\mathrm{T}\)-accounts and prepare an after-closing trial balance.
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