BTA 111 Exam #1

Problem #1: Journalize transactions, prepare ledgers and a trial balance (Show your work)

Mr. Blue is a licensed skin doctor. During the first month of the operation of his business, the

following events and transactions occurred.

April 1 Invested $30,000 cash in his business.

1 Hired a secretary-receptionist at a salary of $800 per week payable monthly.

2 Paid office rent for the month $3,300.

3 Purchased doctor offices supplies on account from Dazzle Company $4,500.

10 Performed medical services and billed insurance companies $5,800.

11 Received $1,000 cash advance from Sebastian for the medical service.

20 Received $2,100 cash for services performed from James.

30 Paid secretary-receptionist for the month $3,200.

30 Paid $2,400 to Dazzle for accounts payable due.

Mr. Blue uses the following chart of accounts: No. 101 Cash, No. 112 Accounts Receivable, No.

126 Supplies, No. 201 Accounts Payable, No. 209 Unearned Service Revenue, No. 301 Owners

Capital, No. 400 Service Revenue, No. 726 Salaries and Wages Expense, and No. 729 Rent

Expense.

(a) Journalize the transactions.

(b) Post to the ledger accounts.

c) Prepare a trial balance on April 30, 2023

D ) Prepare Income Statement, Statement of Owners Equity and Balance Sheet for Mr. Blues business ending on April 30, 2023.

Problem #2: Depreciation Methods (Show your work)

Numo Company purchased a new machine on January 1, 2023, at a cost of $165,000. The

company estimated that the machine will have a salvage value of $35,000.The machine is

expected to be used for 20,000 working hours during its 8-year life. Instructions Compute the

depreciation expense under the following methods for the year indicated. (a) Straight-line for

2023 and 2024. (b) Units-of-activity for 2023, assuming machine usage was 3,800 hours. (c)

Declining-balance using double the straight-line rate for 2023 and 2024.