Clean-Sweep Janitorial, Inc., a company providing janitorial services, was organized July 1, 1999. The following account numbers and titles constitute the chart of accounts for the company:

Transactions Economy Laundry Company had the following transactions in August 1999:
Aug. 1 Issued capital stock for cash, \(\$ 150,000\).
3 Borrowed \(\$ 40,000\) from the bank on a note.
4 Purchased cleaning equipment for \(\$ 25,000\) cash.
6 Performed services for customers who promised to pay later, \(\$ 16,000\).
Paid this month's rent on a building, \(\$ 2,800\).
10 Collections were made for the services performed on August 6, \$3,200 14 Supplies were purchased on account for use this month, \(\$ 3,000\).
17 A bill for \(\$ 400\) was received for utilities for this month.
25 Laundry services were performed for customers who paid immediately, \(\$ 22,000\).
31 Paid employee salaries, \(\$ 6,000\).
31 Paid cash dividend, \(\$ 2,000\).
Required

a. Prepare journal entries for these transactions.

b. Post the journal entries to T-accounts. Enter the account number in the Posting Reference column of the journal as you post each amount. Use the following account numbers:
\begin{tabular}{ll}
Acct. & \\
No. & \multicolumn{1}{c}{ Account Title } \\
100 & Cash \\
103 & Accounts Receivable \\
170 & Equipment \\
200 & Accounts Payable \\
201 & Notes Payable \\
300 & Capital Stock \\
320 & Dividends \\
400 & Service Revenue \\
507 & Salaries Expense \\
511 & Utilities Expense \\
515 & Rent Expense \\
518 & Supplies Expense \end{tabular}

c. Prepare a trial balance as of August 31, 1999.
Clean-Sweep Janitorial, Inc., a company providing janitorial services, was organized July 1, 1999. The following account numbers and titles constitute the chart of accounts for the company:
\begin{tabular}{ll}
Acct. & \\
No. & \multicolumn{1}{c}{ Account Title } \\
100 & Cash \\
103 & Accounts Receivable \\
150 & Trucks \\
160 & Office Equipment \\
170 & Equipment \\
200 & Accounts Payable \\
201 & Notes Payable \\
300 & Capital Stock \\
310 & Retained Earnings \\
320 & Dividends \\
400 & Service Revenue \\
506 & Gas and Oil Expense \\
507 & Salaries Expense \\
511 & Utilities Expense \\
512 & Insurance Expense \\
515 & Rent Expense \\
518 & Supplies Expense \end{tabular}
July 1 The company issued \(\$ 600,000\) of capital stock for cash.
5 Office space was rented for July, and \(\$ 5,000\) was paid for the rental.
8 Desks and chairs were purchased for the office on account, \(\$ 28,800\).
10 Equipment was purchased for \(\$ 50,000\); a note was given, to be paid in 30 days 15 Purchased trucks for \(\$ 150,000\), paying \(\$ 120,000\) cash and giving a 60 -day note to the dealer for \(\$ 30,000\).

July 18 Paid for supplies received and already used, \(\$ 2,880\).
23 Received \(\$ 17,280\) cash as service revenue.
27 Insurance expense for July was paid, \(\$ 4,500\)
30 Paid for gasoline and oil used by the truck in July, \(\$ 576\).
31 Billed customers for janitorial services rendered, \(\$ 40,320\).
31 Paid salaries for July, \(\$ 51,840\).
31 Paid utilities bills for July, \(\$ 5,280\).
31 Paid cash dividends, \(\$ 9,600\).

a. Prepare general ledger accounts for all of these accounts except Retained Earnings. The Retained Earnings account has a beginning balance of zero and maintains this balance throughout the period.

b. Journalize the transactions given for July 1999 in the general journal.

c. Post the journal entries to three-column ledger accounts.

d. Prepare a trial balance as of July 31, 1999 .

Transcribed Image Text:

Acct. No. Account Title 100 Cash 103 Accounts Receivable 150 Trucks 160 Office Equipment 170 Equipment 200 Accounts Payable 201 Notes Payable 300 Capital Stock 310 Retained Earnings 320 400 Dividends Service Revenue 506 Gas and Oil Expense 507 Salaries Expense 511 Utilities Expense 512 Insurance Expense 515 518 Rent Expense Supplies Expense