Background JW's LOck & Key is owned and operated by Jake Walters and is located in Odessa, TX. Jake is a locksmith and provides locksmith services and has a store that sells everything from keys to safes. You have just been hired as the accountant as of December 1, 2020. Required 1. The general ledger contains the current balances for all accounts as of November 30, 2020. The subsidiary ledgers for A/R and A/P also contain the current balances as of November 30, 2020. Review the information in these accounts before beginning the project 2. Journalize the December transactions in the general journal. Descriptions are not required. 3. Post daily to the Accounts Receivable Subsidiary Ledger and the Accounts Payable Subsidiary Ledger Place a checkmark in the Post Reference column of the General Ledger next to the GL account number; i.e. 201/.The checkmark denotes that you have posted to the Subsidiary Ledger account. On December 31, post to the General Ledger 4. Prepare an Unadjusted Trial Balance, using the worksheet. Complete the worksheet using the following adjustment information for December: Office supplies on hand on December 31 are $1,058 b. a. A physical count of inventory showed an ending inventory cost of $44,500. Recorded depreciation on equipment for the month, $4,200 d. C. Insurance expired during December is $300. Earned $1,500 worth of the unearned service revenue Sales refunds estimated for the year $10,000 Cost of estimated returns for the year $2,000 e. f. g. 5. Journalize and post the adjusting entries. 6. Prepare JW's Lock & Key's financial statements for the year ended December 31, 2020. Note: Jake Walter's Capital at January 1, 2020 was $262,643. 7. Journalize and post the closing entries 8. Prepare a Post-Closing Trial Balance Check Figures: $907,503 $161,398 $203,356 Unadjusted Trial Balance: Cash Account Balance Net Income (Loss): W's Lock & Key had the following transactions in December: Dec. 1 Paid December's rent, check # 6287, $2,800. Paid annual premiums on property and casualty insurance policies, check # 6288, $3,600. 2 3 Performed locksmith services on new house, sent invoice # 601 to the homeowner, Sam Mason, $2,000 4 Issued Invoice # 602 to Hastings who purchased a new safe on account, $3,800 Cost of Merchandise Sold was $1,250. 5 Purchased office supplies, check # 6289, $620. 6 Purchased inventory from Key Supplies Co., $5,500. terms 1/10, n/30 7 Paid UPS $216 cash for delivery of the inventory purchased on December 6 7 Jake deposited an additional $5,000 cash in the business 8 Returned damaged inventory to Key Supplies Co., $500 8 Received $2,500 cash, an advance payment for locksmith services. 9 Unlocked a safe for a customer and received $1,000 cash 9 Bought a new computer (equipment) from Office Depot on account, $1,967. 10 Sold 2 safes and received cash, $2,200. Cost of Merchandise Sold was $800 11 Purchased 5 safes to restock inventory on account from Brinks Co, $4,187 terms, 2/5, n/45 12 Customer returned one of the safes purchased on December 10, refunded the customer $1,000 cash. Cost of Merchandise Sold was $475 13 Paid Verizon for wireless telephone services, $482, check # 6290. 14 Paid Key Supplies Co for the purchase on December 6, less return and discount, check # 6291. 14 Received cash on account, $1,500, From Nathan Dean. Dean did not pay his November invoice #590 within the credit terms 2/10. The discount was forfeited. 15 Recorded cash sales for the store from the 1st to the 15th, $13,908. Cost of Merchandise Sold was $4,783. Received $1,900 from Hastings on account 16 Paid Office Depot on account, $500, check # 6292. 17 18 Performed locksmith services on account for Larry Contractor, $700. Paid electricity bill for December, check # 6293, $1,763. 19 19 Paid for Domino's pizza delivery for the December office party, check #6294, $175 Jake withdrew $10,000 for a vacation 20 25 Paid the water bill for December, check # 6295, $120. 25 Paid Brinks Co. on account, $2,500, check # 6296 26 Paid part time employees their salary, $2,250. Received cash on account from Larry Contractor, $700. 27 Recorded cash sales for the store from the 16th to the 30th, $8,735. Cost of Merchandise Sold was $2,784 30 Assets Liabilities 201 Accounts Payable 203 Refunds Payable 101 Cash 105 Accounts Receivable 110 Inventory 112 Estimated Returns Inventory 115 Office Supplies 117 Prepaid Insurance 120 Equipment 121 Accum. Depreciation Equipment 205 Unearned Service Revenue Owner's Equity Jake Walters, Capital Jake Walters, Withdrawal 301 311 Revenues Expenses Cost of Merchandise Sold 401 Service Revenue 501 405 Sales Revenue 502 Advertising Expense 505 Depreciation Expense 507 Insurance Expense 508 Office Supplies Expense 509 Salary Expense 511 Rent Expense 512 Telephone Expense 513 Utilities Expense 525 Miscellaneous Expense 410 Sales Discounts Forfeited Other Misc 999 Income Summary General Journal PAGE 37 Accounts& Explanations DATE PR DEBIT CREDIT General Journal PAGE 38 Accounts & Explanations DATE PR DEBIT CREDIT Cash ACCOUNT ACCOUNT NO 101 2020 DATE BALANCE POST REF ITEM DEBIT CREDIT DEBIT CREDIT 154,931 Nov 30 Bal. Accounts Receivable ACCOUNT ACCOUNT NO 105 2020 DATE BALANCE POST ITEM DEBIT CREDIT DEBIT REF CREDIT 4,108 Bal Nov 30 Inventory ACCOUNT ACCOUNT NO 110 2020 BALANCE POST ITEM DEBIT CREDIT DATE REF DEBIT CREDIT 46,525 Bal Nov 30 Prepaid Insurance ACCOUNT ACCOUNT NO 117 2020 BALANCE POST REF ITEM DEBIT CREDIT DATE DEBIT CREDIT 300 Nov 30 Bal. Equipment ACCOUNT ACCOUNT NO 120 2020 BALANCE POST ITEM DEBIT CREDIT DATE CREDIT REF DEBIT 265,000 Nov 30 Bal. Accumulated Depreciation Equipment ACCOUNT ACCOUNT NO 121 2020 BALANCE POST ITM DEBIT CREDIT DATE REF DEBIT CREDIT 115,500 Nov 30 Bal. Accounts Payable ACCOUNT ACCOUNT NO 201 2020 BALANCE POST ITEM DEBIT CREDIT DATE REF DEBIT CREDIT 3,433 Nov 30 Bal. Refunds Payable ACCOUNT ACCOUNT NO 203 BALANCE 2020 POST ITEM DEBIT CREDIT DATE REF DEBIT CREDIT 500 Nov 30 Bal. ACCOUNT ACCOUNT NO Unearned Service Revenue 205 BALANCE 2020 POST ITEM DEBIT CREDIT DATE CREDIT REF DEBIT Nov. Bal. 500 30 Jake Walters, Capital ACCOUNT ACCOUNT NO 301 BALANCE 2020 POST REF ITEM DEBIT CREDIT DATE DEBIT CREDIT 262,643 Bal. Nov 30 Jake Walters, Withdrawal ACCOUNT ACCOUNT NO 311 2020 BALANCE POST ITEM DEBIT CREDIT DATE REF DEBIT CREDIT 112,000 Nov 30 Bal. Service Revenue 401 ACCOUNT ACCOUNT NO BALANCE 2020 DATE POST ITEM DEBIT CREDIT REF DEBIT CREDIT 167,050 Nov 30 Bal. Sales Revenue ACCOUNT ACCOUNT NO 405 BALANCE 2020 DATE POST ITEM DEBIT CREDIT REF DEBIT CREDIT 312,900 Nov 30 Bal. Sales Discounts Forfeited ACCOUNT NO ACCOUNT 410 BALANCE 2020 DATE POST REF ITEM DEBIT CREDIT DEBIT CREDIT Nov 30 Bal. 2,450 Cost of Merchandise Sold ACCOUNT ACCOUNT NO 501 BALANCE 2020 POST CREDIT ITEM DEBIT DATE REF DEBIT CREDIT 145,687 Nov 30 Bal. Advertising Expense ACCOUNT ACCOUNT NO 502 2020 BALANCE POST ITEM DEBIT CREDIT DATE REF DEBIT CREDIT 9,250 Nov 30 Bal. Cost of Merchandise Sold ACCOUNT ACCOUNT NO 501 BALANCE 2020 POST CREDIT ITEM DEBIT DATE REF DEBIT CREDIT 145,687 Nov 30 Bal. Advertising Expense ACCOUNT ACCOUNT NO 502 2020 BALANCE POST ITEM DEBIT CREDIT DATE REF DEBIT CREDIT 9,250 Nov 30 Bal. Depreciation Expense ACCOUNT ACCOUNT NO 505 2020 BALANCE POST ITEM DEBIT CREDIT DATE REF DEBIT CREDIT 38,500 Nov 30 Bal. Insurance Expense ACCOUNT ACCOUNT NO 507 2020 DATE BALANCE POST CREDIT ITEM DEBIT REF DEBIT CREDIT 3,500 Nov 30 Bal. Office Supplies Expense ACCOUNT ACCOUNT NO 508 2020 DATE BALANCE POST REF ITEM DEBIT CREDIT DEBIT CREDIT 3,280 Nov 30 Bal. Salary Expense ACCOUNT NO ACCOUNT 509 2020 BALANCE POST REF ITEM DEBIT CREDIT DATE DEBIT CREDIT 37,500 Nov 30 Bal. Rent Expense ACCOUNT NO ACCOUNT 511 BALANCE 2020 DATE POST ITEM DEBIT CREDIT DEBIT REF CREDIT 27,500 Bal Nov 30 Telephone Expense ACCOUNT ACCOUNT NO 512 BALANCE 2020 DATE POST ITEM DEBIT CREDIT DEBIT REF CREDIT 4,770 Bal Nov 30 Utilities Expense ACCOUNT ACCOUNT NO 513 2020 DATE BALANCE POST REF ITEM DEBIT CREDIT DEBIT CREDIT 6,725 Bal Nov 30 Miscellaneous Expense ACCOUNT ACCOUNT NO 525 2020 BALANCE POST ITEM DEBIT CREDIT DATE REF DEBIT CREDIT 3,465 Bal Nov 30 Income Summary ACCOUNT ACCOUNT NO 999 BALANCE 2020 DATE POST ITEM DEBIT CREDIT REF DEBIT CREDIT Accounts Receivable Subsidiary Ledger ACCOUNT: Nathan Dean BALANCE 2020 ITEM DEBIT CREDIT DATE POST REF. DEBIT CREDIT Bal Nov 30 2,675 ACCOUNT: Jillian Roberts 2020 BALANCE ITEM DEBIT CREDIT DATE POST REF DEBIT CREDIT Nov 30 Bal. 1,433 ACCOUNT: Larry Contractor 2020 DATE BALANCE ITEM DEBIT CREDIT POST REF DEBIT CREDIT Nov 30 Bal. ACCOUNT: Lowes BALANCE 2020 ITM DEBIT CREDIT DATE POST REF. DEBIT CREDIT Nov 30 Bal. 756 Lock Supply Co ACCOUNT: 2020 DATE BALANCE ITM DEBIT CREDIT POST REF. DEBIT CREDIT Bal Nov 30 2,677 ACCOUNT: 2020 DATE BALANCE ITEM DEBIT CREDIT POST REF. DEBIT CREDIT Background JW's LOck & Key is owned and operated by Jake Walters and is located in Odessa, TX. Jake is a locksmith and provides locksmith services and has a store that sells everything from keys to safes. You have just been hired as the accountant as of December 1, 2020. Required 1. The general ledger contains the current balances for all accounts as of November 30, 2020. The subsidiary ledgers for A/R and A/P also contain the current balances as of November 30, 2020. Review the information in these accounts before beginning the project 2. Journalize the December transactions in the general journal. Descriptions are not required. 3. Post daily to the Accounts Receivable Subsidiary Ledger and the Accounts Payable Subsidiary Ledger Place a checkmark in the Post Reference column of the General Ledger next to the GL account number; i.e. 201/.The checkmark denotes that you have posted to the Subsidiary Ledger account. On December 31, post to the General Ledger 4. Prepare an Unadjusted Trial Balance, using the worksheet. Complete the worksheet using the following adjustment information for December: Office supplies on hand on December 31 are $1,058 b. a. A physical count of inventory showed an ending inventory cost of $44,500. Recorded depreciation on equipment for the month, $4,200 d. C. Insurance expired during December is $300. Earned $1,500 worth of the unearned service revenue Sales refunds estimated for the year $10,000 Cost of estimated returns for the year $2,000 e. f. g. 5. Journalize and post the adjusting entries. 6. Prepare JW's Lock & Key's financial statements for the year ended December 31, 2020. Note: Jake Walter's Capital at January 1, 2020 was $262,643. 7. Journalize and post the closing entries 8. Prepare a Post-Closing Trial Balance Check Figures: $907,503 $161,398 $203,356 Unadjusted Trial Balance: Cash Account Balance Net Income (Loss): W's Lock & Key had the following transactions in December: Dec. 1 Paid December's rent, check # 6287, $2,800. Paid annual premiums on property and casualty insurance policies, check # 6288, $3,600. 2 3 Performed locksmith services on new house, sent invoice # 601 to the homeowner, Sam Mason, $2,000 4 Issued Invoice # 602 to Hastings who purchased a new safe on account, $3,800 Cost of Merchandise Sold was $1,250. 5 Purchased office supplies, check # 6289, $620. 6 Purchased inventory from Key Supplies Co., $5,500. terms 1/10, n/30 7 Paid UPS $216 cash for delivery of the inventory purchased on December 6 7 Jake deposited an additional $5,000 cash in the business 8 Returned damaged inventory to Key Supplies Co., $500 8 Received $2,500 cash, an advance payment for locksmith services. 9 Unlocked a safe for a customer and received $1,000 cash 9 Bought a new computer (equipment) from Office Depot on account, $1,967. 10 Sold 2 safes and received cash, $2,200. Cost of Merchandise Sold was $800 11 Purchased 5 safes to restock inventory on account from Brinks Co, $4,187 terms, 2/5, n/45 12 Customer returned one of the safes purchased on December 10, refunded the customer $1,000 cash. Cost of Merchandise Sold was $475 13 Paid Verizon for wireless telephone services, $482, check # 6290. 14 Paid Key Supplies Co for the purchase on December 6, less return and discount, check # 6291. 14 Received cash on account, $1,500, From Nathan Dean. Dean did not pay his November invoice #590 within the credit terms 2/10. The discount was forfeited. 15 Recorded cash sales for the store from the 1st to the 15th, $13,908. Cost of Merchandise Sold was $4,783. Received $1,900 from Hastings on account 16 Paid Office Depot on account, $500, check # 6292. 17 18 Performed locksmith services on account for Larry Contractor, $700. Paid electricity bill for December, check # 6293, $1,763. 19 19 Paid for Domino's pizza delivery for the December office party, check #6294, $175 Jake withdrew $10,000 for a vacation 20 25 Paid the water bill for December, check # 6295, $120. 25 Paid Brinks Co. on account, $2,500, check # 6296 26 Paid part time employees their salary, $2,250. Received cash on account from Larry Contractor, $700. 27 Recorded cash sales for the store from the 16th to the 30th, $8,735. Cost of Merchandise Sold was $2,784 30 Assets Liabilities 201 Accounts Payable 203 Refunds Payable 101 Cash 105 Accounts Receivable 110 Inventory 112 Estimated Returns Inventory 115 Office Supplies 117 Prepaid Insurance 120 Equipment 121 Accum. Depreciation Equipment 205 Unearned Service Revenue Owner's Equity Jake Walters, Capital Jake Walters, Withdrawal 301 311 Revenues Expenses Cost of Merchandise Sold 401 Service Revenue 501 405 Sales Revenue 502 Advertising Expense 505 Depreciation Expense 507 Insurance Expense 508 Office Supplies Expense 509 Salary Expense 511 Rent Expense 512 Telephone Expense 513 Utilities Expense 525 Miscellaneous Expense 410 Sales Discounts Forfeited Other Misc 999 Income Summary General Journal PAGE 37 Accounts& Explanations DATE PR DEBIT CREDIT General Journal PAGE 38 Accounts & Explanations DATE PR DEBIT CREDIT Cash ACCOUNT ACCOUNT NO 101 2020 DATE BALANCE POST REF ITEM DEBIT CREDIT DEBIT CREDIT 154,931 Nov 30 Bal. Accounts Receivable ACCOUNT ACCOUNT NO 105 2020 DATE BALANCE POST ITEM DEBIT CREDIT DEBIT REF CREDIT 4,108 Bal Nov 30 Inventory ACCOUNT ACCOUNT NO 110 2020 BALANCE POST ITEM DEBIT CREDIT DATE REF DEBIT CREDIT 46,525 Bal Nov 30 Prepaid Insurance ACCOUNT ACCOUNT NO 117 2020 BALANCE POST REF ITEM DEBIT CREDIT DATE DEBIT CREDIT 300 Nov 30 Bal. Equipment ACCOUNT ACCOUNT NO 120 2020 BALANCE POST ITEM DEBIT CREDIT DATE CREDIT REF DEBIT 265,000 Nov 30 Bal. Accumulated Depreciation Equipment ACCOUNT ACCOUNT NO 121 2020 BALANCE POST ITM DEBIT CREDIT DATE REF DEBIT CREDIT 115,500 Nov 30 Bal. Accounts Payable ACCOUNT ACCOUNT NO 201 2020 BALANCE POST ITEM DEBIT CREDIT DATE REF DEBIT CREDIT 3,433 Nov 30 Bal. Refunds Payable ACCOUNT ACCOUNT NO 203 BALANCE 2020 POST ITEM DEBIT CREDIT DATE REF DEBIT CREDIT 500 Nov 30 Bal. ACCOUNT ACCOUNT NO Unearned Service Revenue 205 BALANCE 2020 POST ITEM DEBIT CREDIT DATE CREDIT REF DEBIT Nov. Bal. 500 30 Jake Walters, Capital ACCOUNT ACCOUNT NO 301 BALANCE 2020 POST REF ITEM DEBIT CREDIT DATE DEBIT CREDIT 262,643 Bal. Nov 30 Jake Walters, Withdrawal ACCOUNT ACCOUNT NO 311 2020 BALANCE POST ITEM DEBIT CREDIT DATE REF DEBIT CREDIT 112,000 Nov 30 Bal. Service Revenue 401 ACCOUNT ACCOUNT NO BALANCE 2020 DATE POST ITEM DEBIT CREDIT REF DEBIT CREDIT 167,050 Nov 30 Bal. Sales Revenue ACCOUNT ACCOUNT NO 405 BALANCE 2020 DATE POST ITEM DEBIT CREDIT REF DEBIT CREDIT 312,900 Nov 30 Bal. Sales Discounts Forfeited ACCOUNT NO ACCOUNT 410 BALANCE 2020 DATE POST REF ITEM DEBIT CREDIT DEBIT CREDIT Nov 30 Bal. 2,450 Cost of Merchandise Sold ACCOUNT ACCOUNT NO 501 BALANCE 2020 POST CREDIT ITEM DEBIT DATE REF DEBIT CREDIT 145,687 Nov 30 Bal. Advertising Expense ACCOUNT ACCOUNT NO 502 2020 BALANCE POST ITEM DEBIT CREDIT DATE REF DEBIT CREDIT 9,250 Nov 30 Bal. Cost of Merchandise Sold ACCOUNT ACCOUNT NO 501 BALANCE 2020 POST CREDIT ITEM DEBIT DATE REF DEBIT CREDIT 145,687 Nov 30 Bal. Advertising Expense ACCOUNT ACCOUNT NO 502 2020 BALANCE POST ITEM DEBIT CREDIT DATE REF DEBIT CREDIT 9,250 Nov 30 Bal. Depreciation Expense ACCOUNT ACCOUNT NO 505 2020 BALANCE POST ITEM DEBIT CREDIT DATE REF DEBIT CREDIT 38,500 Nov 30 Bal. Insurance Expense ACCOUNT ACCOUNT NO 507 2020 DATE BALANCE POST CREDIT ITEM DEBIT REF DEBIT CREDIT 3,500 Nov 30 Bal. Office Supplies Expense ACCOUNT ACCOUNT NO 508 2020 DATE BALANCE POST REF ITEM DEBIT CREDIT DEBIT CREDIT 3,280 Nov 30 Bal. Salary Expense ACCOUNT NO ACCOUNT 509 2020 BALANCE POST REF ITEM DEBIT CREDIT DATE DEBIT CREDIT 37,500 Nov 30 Bal. Rent Expense ACCOUNT NO ACCOUNT 511 BALANCE 2020 DATE POST ITEM DEBIT CREDIT DEBIT REF CREDIT 27,500 Bal Nov 30 Telephone Expense ACCOUNT ACCOUNT NO 512 BALANCE 2020 DATE POST ITEM DEBIT CREDIT DEBIT REF CREDIT 4,770 Bal Nov 30 Utilities Expense ACCOUNT ACCOUNT NO 513 2020 DATE BALANCE POST REF ITEM DEBIT CREDIT DEBIT CREDIT 6,725 Bal Nov 30 Miscellaneous Expense ACCOUNT ACCOUNT NO 525 2020 BALANCE POST ITEM DEBIT CREDIT DATE REF DEBIT CREDIT 3,465 Bal Nov 30 Income Summary ACCOUNT ACCOUNT NO 999 BALANCE 2020 DATE POST ITEM DEBIT CREDIT REF DEBIT CREDIT Accounts Receivable Subsidiary Ledger ACCOUNT: Nathan Dean BALANCE 2020 ITEM DEBIT CREDIT DATE POST REF. DEBIT CREDIT Bal Nov 30 2,675 ACCOUNT: Jillian Roberts 2020 BALANCE ITEM DEBIT CREDIT DATE POST REF DEBIT CREDIT Nov 30 Bal. 1,433 ACCOUNT: Larry Contractor 2020 DATE BALANCE ITEM DEBIT CREDIT POST REF DEBIT CREDIT Nov 30 Bal. ACCOUNT: Lowes BALANCE 2020 ITM DEBIT CREDIT DATE POST REF. DEBIT CREDIT Nov 30 Bal. 756 Lock Supply Co ACCOUNT: 2020 DATE BALANCE ITM DEBIT CREDIT POST REF. DEBIT CREDIT Bal Nov 30 2,677 ACCOUNT: 2020 DATE BALANCE ITEM DEBIT CREDIT POST REF. DEBIT CREDIT