Browne Cleaning and Gardening Services commenced on 1 June 2020 when Lorne Browne contributed $120 000 into a business bank account. The following transactions occurred in the month of June. Ignore GST.

Additional information 

The accounting period closed on 30 June 2020, and the following additional data was available.

1. Wages owing to the assistant on 30 June amounted to $620.

2. A physical count showed that only $260 of washing supplies and $750 of fuel and oil supplies were still on hand.

3. Four weeks of advertisements had appeared in the local community newspaper up to 30 June.

4. Cleaning services of $550 had been rendered to clients on 29 June but the invoice to bill these clients had not been prepared.

5. The business had provided cleaning services to its shopping centre client for 3 weeks of the first month (assumed to be 4 weeks long).

Required

(a) Prepare journal entries to record the June 2020 transactions for Browne Cleaning and Gardening Services and post these journal entries to suitable running balance ledger accounts. Provide appropriate account numbers and journal page numbers and record them in post ref columns.

(b) Prepare an unadjusted trial balance as at 30 June 2020.

(c) Prepare adjusting entries and post them to the ledger accounts. Be careful to ensure that all adjusting entries have been recorded. Explain the reasons for each adjusting entry that you have made.

(d) Prepare an adjusted trial balance.

(e) Prepare closing entries, post them to the accounts and prepare a post‐closing trial balance.

(f) Prepare the income statement, the statement of changes in equity and the balance sheet as at 30 June 2020.
(g) Prepare any suitable reversing entries on 1 July 2020 and post them to the accounts.

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June 1 2 2 3 6 Co 13 14 14 21 28 28 30 Lorne signed a lease agreement to lease a suitable storage shed for a monthly rental of $2600. Rent for 3 months was paid in advance. He also hired an assistant to help him with cleaning and lawn mowing tasks. The assistant was to be paid casual wages. The business acquired suitable cleaning and gardening equipment for a total cost of $40 320. A deposit of $8500 was paid immediately and the balance was to be paid in 30 days. The equipment was expected to have a useful life of 6 years. Purchased a quantity of washing supplies for $1060 cash. Purchased fuel and oil supplies for $1740 cash. Signed a contract with Community Newspapers for 12 weeks of advertisements in its weekly free newspaper delivered to local homes. The business paid $960 in advance for these advertisements. Received cash of $180 from a grateful client whose house had been cleaned by the business before the monthly rent inspection. Received cash of $2800 for several lawns that had been mowed for clients during the week. Signed a contract with the local shopping centre to provide cleaning services to its outside walls (including graffiti removal) for a monthly fee of $3200. The shopping centre paid for 2 months' services in advance. Received cash of $3000 for lawn mowing services provided to clients during the past week. Paid the assistant casual wages of $1540 for services provided to the business during the past fortnight. Earned $1600 for cleaning services from clients and $2790 for lawn mowing during the past week. All money was received in cash except for one client for cleaning services, who arranged to pay the business $300 in 3 weeks' time for services rendered. Received in cash the sum of $1760 for cleaning services provided to clients and $2530 for lawn mowing and gardening services provided during the past week. Paid the assistant $1670 for services provided to the business during the past fortnight. Lorne withdrew $4000 in cash from the business in order to pay for essential provisions for his family.