Question
April 1, 2013, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the companys first month. April 1 Nozomi invested
April 1, 2013, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the companys first month. |
April | 1 | Nozomi invested $43,000 cash and computer equipment worth $33,000 in the company in exchange for common stock. | |
2 | The company rented furnished office space by paying $3,100 cash for the first months (April) rent. | ||
3 | The company purchased $2,300 of office supplies for cash. | ||
10 | The company paid $3,150 cash for the premium on a 12-month insurance policy. Coverage begins on April 11. | ||
14 | The company paid $2,900 cash for two weeks salaries earned by employees. | ||
24 | The company collected $14,500 cash on commissions from airlines on tickets obtained for customers. | ||
28 | The company paid $2,900 cash for two weeks salaries earned by employees. | ||
29 | The company paid $800 cash for minor repairs to the companys computer. | ||
30 | The company paid $1,100 cash for this months telephone bill. | ||
30 | The company paid $2,800 cash for dividends. |
The companys chart of accounts follows: |
101 | Cash | 405 | Commissions Earned |
106 | Accounts Receivable | 612 | Depreciation ExpenseComputer Equip. |
124 | Office Supplies | 622 | Salaries Expense |
128 | Prepaid Insurance | 637 | Insurance Expense |
167 | Computer Equipment | 640 | Rent Expense |
168 | Accumulated DepreciationComputer Equip. | 650 | Office Supplies Expense |
209 | Salaries Payable | 684 | Repairs Expense |
307 | Common Stock | 688 | Telephone Expense |
318 | Retained Earnings | 901 | Income Summary |
319 | Dividends | ||
Use the following information: |
4.1 | Journalize the adjusting entries for the month and then post to section 6.2. |
a. | Two-thirds (or $175) of one months insurance coverage has expired. |
b. | At the end of the month, $1,250 of office supplies are still available. |
c. | This months depreciation on the computer equipment is $1,150. |
d. | Employees earned $550 of unpaid and unrecorded salaries as of month-end. |
e. | The company earned $3,050 of commissions that are not yet billed at month-end. Two-thirds (or $175) of one months insurance coverage has expired. 2. At the end of the month, $1,250 of office supplies are still available. 3. This months depreciation on the computer equipment is $1,150. 4. Employees earned $550 of unpaid and unrecorded salaries as of month-end. 5. The company earned $3,050 of commissions that are not yet billed at month-end. |
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started