1 1 6 on November 1, 2018, Kris Lehman established an Interior decorating business, Modern Designs. During the month, Kris completed the following transactions related to the business Nov. Kris transterred cash from a personal bank account to an account to be used for the business in exchange for common stock. $27,200 Paid rent for period of November 1 to end of month, $4.000. Purchased office equipment on account. $12,820 Purchased a truck for $30,800 paying $6.900 cash and giving a note payable for the remainder Purchased supplies for cash, $1,650. Received cash for job completed, $8,000 15 Paid annual premiums on property and casualty insurance, $2,300 Recorded jobs completed on account and sent invoices to customers, $12,000 Received an invoice for truck expenses, to be paid in November, S1,190 B 10 12 23 24 Enter the following transactions on Page 2 of the two-column journal Nov 29 29 30 Pald utilities expense, $3.560 Paid miscellaneous expenses, $1,800 Received cash from customers on account, $7.500 Paid wages of employees, $4,750. Paid creditor a portion of the amount owed for equipment purchased on November 6, $6,230 Pald dividends, $2,000. 30 30 30 Enter the following transactions on Page 2 of the two column Journal Nov. 29 Paid utilities expense, $3,560. Paid miscellaneous expenses, $1,800. 29 30 Received cash from customers on account, $7,500. 30 30 Pald wages of employees, $4,750 Paid creditor a portion of the amount owed for equipment purchased on November 6, $6,230. Paid dividends, $2,000 30 Required: 1. Journalize each transaction in a two-column journal beginning on Page 1, referring to the chart of accounts in selecting the accounts to be debited and credited. (Do not insert the post reference numbers until you have posted the entry to the general ledger in part 2) Refer to the Chart of Accounts for exact wording of account titles. 2. Post (in chronological order) the journal to a ledger of four-column accounts, inserting appropriate posting references in both the journal and the ledger as each item is posted. Extend the balances to the appropriate balance columns after each transaction is posted. 3. Prepare an unad usted trial balance for Modern Designs as of November 30, 2018 4. Determine the excess of revenues over expenses for November 5. Can you think of any reason why the amount determined in (4) might not be the net income for November? 1. Journalize each transaction in a two-column Journal beginning on Page 1, referring to the chart of accounts in selecting the accounts to be debuted and credited. (Do not insert the post reference numbers until you have posted the entry to the general ledger in part 2) Refer to the Chart of Accounts for exact wording of account bles. PAGE 1 wa ACCOUNTING EQUATION JOURNAL POST. REY DEBIT DESCRIPTION CREDIT ASSETS LIABILITIES EQUITY DATE 1 1 3 4 I 5 7 9 10 11 12 Journal DATE DESCRIPTION POST. REX DEBIT CREDIT ASSETS LABILITIES EQUITY 1 2 3 3 6 7 1 10 11 12 13 14 15 18 11 18 15 Previous Journal 1. Journalize each transaction in a two-column journa/boging on Page 1, referring to the chart of account in selecting the accounts to be debited and credited (Do not use the post reference numbers and you have posted the evitry to the general ledgern part 2.) Refer to the Chart of Accounts for exact wording of account nos PAGE PAGE 2 JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST. REF DITT OREDIT ASSETS LIANTIE OUTY 1 5 7 . 10 11 12 Journal Lodger 2 post in chronological order) the journal to a ledger of four-column accounts, inserting appropriate posting references in both the journal and the ledger as each com is posted Extend the balances to the appropriate balance columns after each transaction is posted. LEDGER Account No. 11 Account: Cash BALANCE DATE ITEM POST. REF DEBIT CREDIT OCHT CREDIT 1 1 1 5 7 1 . 10 11 11 Account N12 Account Accounts Receivable Previous Ledger Shaded cells have feedback. X Account No. 12 Account: Accounts Receivable DATE BALANCE ITEM POST. REF. DEBIT CREDIT DEBIT CREDIT 1 2 Account Supplies Account No. 13 BALANCE DATE ITEM POST. REF DEBIT CREDIT DERIT CREDIT 7.00 H 700 1 Account No. 14 Account: Prepaid Insurance BALANCE POST. REF ITEM DET CREDIT DATE DEBIT CREDIT 1 Account No. 16 Account: Equipment BALANCE DEBIT CREDIT POST. REF. ITEM DERIT CREDIT DATE 1 Account No. 18 Account: Truck I BALANCE DENT CREDIT POST. REY DEBIT CREDIT ITEM DATE 1 Account No. 21 Account: Notes Payable Ledger Account Accounts Payable Shaded cols have feedback. Account No. 22 BALANCE DATE ITEM POST. REF DEBIT CREDIT DEBIT CREDIT 1 2 3 Account No. 11 Account: Common Stock BALANCE ITEM POST. REF CREDIT DEBIT DEBIT CREDIT DATE Account No. 33 Account: Dividends BALANCE DEBIT POST. REF CREDIT DEBIT CREDIT ITEM DATE 1 Account No. 41 Account: Fees Earned BALANCE CREDIT DERIT CREDIT DEBIT POST. REF ITEM DATE 1 1 Account No. 51 2 BALANCE Account: Wages Expense CREDIT DET DENT CREDIT POST. REF ITEM DATE Looger Shaded colle have feedback Shaded cells have feedback. X Account: Wages Expense Account No. 51 DATE ITEM POSTRE DEBIT CREDIT BALANCE 1 DEBIT CREDIT Account Rent Expense Account No. 53 ITEM POST. REF DEBIT CREDIT BALANCE DEBIT 1 CREDIT Account: Utilities Expense Account No. 54 DATE ITEM POST. REF DEBIT CREDIT BALANCE DEBIT CREDIT 1 Account: Truck Expense Account No. 55 DATE ITEM POST. REF DEBIT CREDIT BALANCE DEBIT CREDIT 1 Account: Miscellaneous Expense Account No. 59 DATE ITEM POST. REF DEBIT BALANCE CREDIT DEBIT CREDIT . Unadjusted Trial Balance Shaded cells have feedback. 3. Prepare an unadjusted trial balance for Modern Designs as of November 30, 2018. Question not attempted. Modern Designs Score: 0/67 UNADJUSTED TRIAL BALANCE November 30, 2018 ACCOUNT TITLE DEBIT CREDIT 1 Cash 2 Accounts Receivable 3 Supplies 4 Prepaid Insurance wir $ Equipment nal 6 Truck ted arto 7 Notes Payable 8 Accounts Payable et (in ledg epare 9 Common Stock 10 Dividends term 11 Fees Earned an you 12 Wages Expense 11 Dant. Evanca Chart of Accounts Journal Ledger Unadjusted Trial Balance Final Ques Shaded cells have feedback. nadjusted Trial Balance 1 Cash 2 Accounts Receivable 3 Supplies A Prepaid Insurance 5 Equipment 6 Truck 7 Notes Payable 8 Accounts Payable 9 Common Stock 10 Dividends 11 Fees Earned nal I 12 Wages Expense air 13 Rent Expense 14 Utilities Expense ted no 15 Truck Expense st (in 16 Miscellaneous Expense 17 Totals epare led eterm Points: 0/18 an yol Final Question Shaded cells have fee 4. Determine the excess of revenues over expenses for November $ Points: 0/1 Feedback Check My Work 15 Calculate Revenues - Expenses = Net Income. 16 17 5. Can you think of any reason why the amount determined in (4) might not be the net income for November? Because the cash balance is incorrect. O Because the closing inventory balance is missing. Because the dividends are declared but not pald Because necessary adjustment to expenses, like depreciation has not been made. Points: 0/1