Baker Well Drilling, Inc. of Baker City, Oregon started business June $1,$

$2023.$

Dates and details of events and transactions are as follows.

$6/1$ Issued Common Stock for cash in the amount of $$150,000.$

$6/2$ Purchased a small building to be used as a shop. The price

was $$80,000$: $$12,000$ paid with cash, the remaining balance was

a $5$ year Note Payable in the amount of $$68,000.$ The purchase

price of $$80,000$ was allocated to land in the amount of $$15,000$

and the remaining amount of $$65,000$ to the shop building. Loan

payments are made quarterly; the first payment is due on $9/2/23.$

$6/3$ A Super Heavy$-$Duty Ford Truck was purchased with special $$No

Money Down$$ and $$No Interest$$ through Ford Credit Corporation.

Purchase price was $$55,000$ and the first payment is due on $8/3/23.$

$6/4$ Well Drilling Equipment was purchased for $$18,500$ cash.

$6/4$ Prepaid a $12-$month insurance policy. The policy was effective

as of June $1$st$,$ and cost $$3,540.$

$6/5$ Well Drilling Supplies were purchased on a $30-$day credit account

in the amount of $$2,865.$

$6/6$ Advertised in the weekly Baker City Farm News. Total cost was

$$1,110$ with payment due by July $10$th$.$

$6/7$ Hired an employee at $$3,800$ per month, advising the newly hired

employee that pay day will be on the first business day of each month.

Baker Well Drilling, Inc.

$6/9$ A drilling bid of $$9,900$ was accepted by their first customer for

a job to start on $6/12,$ the contract was signed on $6/9.$

$6/19$ Bid a second job for $$15,900$ and received a $$5,900$ cash payment

in advance $($job is to start on $6/25)$ contract was signed $6/19.$

$6/21$ Completed the well drilling job started on $6/12$ and billed the

customer for the agreed contract price.

$6/28$ Paid the advertising bill received from Baker City Farm News.

$7/2$ Paid employee$$s wages for June. Note: since it was for a short

Month $(6/86/30)$ total paid was prorated in the amount of

$$2,850.$

$7/3$ Paid $$1,000$ on account for the supplies purchased on $6/5.$

$7/6$ Completed the well drilling job started on $6/25$ and billed

customer for the remaining balance due.

$7/12$ Bid a third job for a contract price of $$15,750$ and started the

job immediately.

$7/16$ While working on the third job, a repair to equipment was

required, the cost of the repair was $$810$ and was paid in cash.

$7/18$ Received $$4,000$ partial payment from the first job that was

completed and billed last month on $6/21.$

$7/27$ Completed the third job that was started on $7/12.$ Billed the

customer for the contract price.

Baker Well Drilling, Inc.

Baker City Well Drilling, Inc.

Adjusting Entry Information

Information for adjusting entries covering the two months ended July

$31$st is as follows:

$7/31$ A count of drilling supplies on hand indicated unused supplies

still on hand totaled $$1,455.$

$7/31$ Employee wages of $$3,800$ for the month of July are scheduled

to be paid on August $2$nd$.$

$7/31$ Depreciation expense on the building for $2$ months amounts

to $$1,200.$

Depreciation expense on drilling equipment for $2$ months

amounts to $$450.$

Depreciation expense on the truck for $2$ months amounts

to $$625.$

$7/31$ Interest expense has accrued on the note payable for the shop

building and land in the amount of $$645.$

Financing the Ford Super Heavy$-$Duty Truck was a zero interest

financing offer, therefore, no interest has accrued.

$7/312$ months of the prepaid insurance policy has now expired.

See List of Requirements for this Extra Credit Project on the next page.

Baker Well Drilling, Inc.

The company has hired you to provide accounting services for their first

$$two$$ months of business operations.

The accounting services you$$re to provide are as follows:

$2.$ Post all journal entries to ledger accounts using $$T$$ accounts.

$3.$ Prepare a Trial Balance as of July $31,2023.$

$4.$ Prepare adjusting entries. Note: you may omit explanations.

$5.$ Post adjusting entries to the ledger accounts you have adjusted.

$6.$ Prepare an $$Adjusted Trial Balance$$ as of July $31,2023.$

$7.$ Prepare the following using proper format, headings and dates:

a$.$ Income Statement for the two$-$month period of June through July.

b$.$ Retained Earnings Statement for the same $2-$month period.

c$.$Classified$$ Balance Sheet as of July $31,2023.$

$8.$ Prepare closing journal entries. Note: you may omit explanations.

$9.$ Post the closing entries to ledger accounts.

$10.$ Prepare a Trial Balance after closing as of July $31,2023.$

VERY IMPORTANT: this is your client; therefore, your work must be

well organized, professional and complete.