3-1 Continuing Problem: Journalizing, Posting, and Preparing a Trial Balance A friend of yours, Anika Valli, has decided to open a spa to serve her small resort CLGL town of about 7,000 people and 4 million tourists annually. She has named the business All About You Spa to convey the idea that the business intends to pamper those who enter its doors. She will operate the spa five days a week, Tuesday through Saturday, but a phone line will always be available to answer questions and schedule appointments. Hours will be from 8 A.M. to 8 P.M. She has asked you to be the bookkeeper for this new business. At the end of the month of October, the owner, Anika Valli, would like you to provide the following: 1. General journal 2. General ledger 3. Trial balance 4. Income statement 5. Statement of owner's equity 1. General journal 2. General ledger 3. Trial balance 4. Income statement 5. Statement of owner's equity 6. Balance sheet She has kept a checkbook and a file folder with summary evidence of October's spa activity: a check register, a summary report of charges by customers for services provided, all receipts that were issued, and a summary of charges made by All About You Spa. Most of the income from services is received in cash and as charges to credit cards. No checks are accepted, except from approved clients (primarily conference planners and other organizations that book packages as prizes for attendees or gifts for employees, speakers, or other people they want to thank with a spa service or package of services). Anika deposits cash receipts on customer's accounts on the 7th, 14th, 21st, and last day of each month. The first page in the file folder contains the following chart of accounts. Currently, you will not use or may not be familiar with some of the accounts listed here. Ignore those accounts for now; we will use them later. Chart of Accounts for All about You Spa Assets 111 Cash 113 Accounts Receivable 114 Office Supplies 115 Spa Supplies 117 Prepaid Insurance 124 Office Equipment 125 Accum. Depr.Office Equipment 128 Spa Equipment 129 Accum. Depr.Spa Equipment Liabilities 211 Accounts Payable 212 Wages Pavable Liabilities 211 Accounts Payable 212 Wages Payable Owner's Equity 311 A. Valli, Capital 312 A. Valli, Drawing 313 Income Summary Revenue 411 Income from Services Expenses 611 Wages Expense 612 Rent Expense 613 Office Supplies Expense 614 Sna Supplies Expense Expenses 611 Wages Expense 612 Rent Expense 613 Office Supplies Expense 614 Spa Supplies Expense 615 Laundry Expense 616 Advertising Expense 617 Utilities Expense 618 Insurance Expense 619 Depr. Expense-Office Equipment 620 Depr. ExpenseSpa Equipment 630 Promotional Expense The basis of your entries will be the following documents: Checkbook Entries Checkbook Entries (Deposits made and checks written) Check No. Check Amount Deposits 25,000.00 2011 2012 840.00 3,000.00 2013 2014 2015 1,000.00 230.00 115.00 2016 Date Explanation 10/1 Invested cash in business. 10/3 Bought 6-month liability insurance policy. 10/3 Bought spa equipment from Spa Equipment, Inc., for $5,550, putting $3,000 cash down. 10/3 Paid June rent. 10/5 Bought office supplies. 10/5 Purchased promotional items (flowers and balloons) for grand opening. 10/7 Paid first week's wages. 10/7 Deposited first week's cash revenue. 10/11 Paid on account payable for spa equipment (October 3). 10/14 Deposited second week's cash revenue. 10/14 Paid second week's wages. 10/18 Paid on account for spa equipment (October 3). 10/21 Deposited third week's cash revenue. 10/21 Paid third week's wages. 10/25 Paid on account for spa equipment 2,075.00 3,465.00 2017 1000.00 3,307.00 2018 2019 2,075.00 1,200.00 4,587.00 2020 2021 2,075.00 350.00 2022 2,075.00 2023 105.00 6,588.00 2024 10/28 Paid fourth week's wages. 10/28 Paid month's laundry bill. 10/31 Deposited end of month's cash revenue. 10/31 A. Valli withdrew $1,500 for personal use. 10/31 Paid October telephone bill. 10/31 Paid October power and water bill. 1,500.00 2025 2026 325.00 385.00 Other information that require journal entries: Receipt 10/1 A. Valli, owner of All About You Spa, invested her personal spa equipment $3,575.00 + October Accounts Payable Charges Summary Report 10/3 Bought spa supplies on account from Spa Supplies, Inc., Inv. No. 904 $685.00 10/5 Bought office equipment on account from Office Equipment Company, Inv. No. 4315 $520.00 10/5 Bought advertising pamphlets on account from Adco, Inc., Inv. No. 215 $415.00 1075 Bougnt ortice equipment on account from Office Equipment Company, Inv. No. 4315 $520.00 10/5 Bought advertising pamphlets on account from Adco, Inc., Inv. No. 215 $415.00 10/5 Bought office equipment on account from Office Equipment, Company, Inv. No. 4445 $825.00 10/5 Bought office supplies on account from Office Staples, Inv. No. 222 $125.00 October Sales to Customers on Account Summary Report Jill Anson 10/7 $350.00 10/14 Jack Morgan $468.00 10/21 Tory Ligman $345.00 10/31 Judy Wilcox $110.00 Required 1 Tournalize the transactions for October (in date order in the moneral iournal 10/31 Judy Wilcox $110.00 Required 1. Journalize the transactions for October (in date order) in the general journal. If you are using GL, review the instructions for the program on the textbook website. If you are preparing the journal entries manually, enter your transactions beginning. 2. Post the entries to the general ledger accounts. Ignore this step if you are using CLGL. 3. Prepare a trial balance as of October 31, 20--. 4. Prepare an income statement for the month ended October 31, 20- 5. Prepare a statement of owner's equity for the month ended October 31, 20-- 6. Prepare a balance sheet as of October 31, 20