Colton Enterprises experienced the following events for Year 1, the first year of operation Acquired $37,000 cash from the issue of common stock Paid $12,200 cash in advance for rent The payment was for the period April 1, Year 1, to March 31, Year 2 Performed services for customers on account for $76,000 Incurred operating expenses on account of $36,000 Collected $58,500 cash from accounts receivable Paid $23,000 cash for salary expense Paid $28,800 cash as a partial payment on accounts payable Adjusting Entries Made the adjusting entry for the expired rent (See Event 2 ) Recorded $2,800 of accrued salaries at the end of Year 1 Events for Year 2 Paid $2,800 cash for the salaries accrued at the end of the prior accounting period Performed services for cash of $25,000 Purchased $3,000 of supplies on account Paid $11,100 cash in advance for rent The payment was for one year beginning April 1, Year 2 Performed services for customers on account for $92,000 Incurred operating expenses on account of $43,500 Collected $91,000 cash from accounts receivable Paid $41,000 cash as a partial payment on accounts payable Paid $31,700 cash for salary expense Paid a $11,000 cash dividend to stockholders Adjusting Entries Made the adjusting entry for the expired rent ( Hint Part of the rent was paid in Year 1 ) Recorded supplies expense A physical count showed that $550 of supplies were still on hand Required a Record the events and adjusting entries for Year 1 in general journal form b Post the Year 1 events to T accounts c Prepare a trial balance for Year 1 d 1 Prepare an income statement for Year 1 d 2 Prepare a statement of changes in stockholders equity for Year 1 d 3 Prepare a balance sheet for Year 1 d 4 Prepare a statement of cash flows for Year 1 e Record the entries to close the Year 1 temporary accounts to Retained Earnings in the general journal and post to the T accounts f Prepare a post closing trial balance for December 31, Year 1

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Posted on Sep 02, 2024

Colton Enterprises experienced the following events for Year 1, the first year of operation:

Acquired $37,000 cash from the issue of common stock.
Paid $12,200 cash in advance for rent. The payment was for the period April 1, Year 1, to March 31, Year 2.
Performed services for customers on account for $76,000.
Incurred operating expenses on account of $36,000.
Collected $58,500 cash from accounts receivable.
Paid $23,000 cash for salary expense.
Paid $28,800 cash as a partial payment on accounts payable.

Adjusting Entries

Events for Year 2

Paid $2,800 cash for the salaries accrued at the end of the prior accounting period.
Performed services for cash of $25,000.
Purchased $3,000 of supplies on account.
Paid $11,100 cash in advance for rent. The payment was for one year beginning April 1, Year 2.
Performed services for customers on account for $92,000.
Incurred operating expenses on account of $43,500.
Collected $91,000 cash from accounts receivable.
Paid $41,000 cash as a partial payment on accounts payable.
Paid $31,700 cash for salary expense.
Paid a $11,000 cash dividend to stockholders.

Adjusting Entries

Made the adjusting entry for the expired rent. (Hint: Part of the rent was paid in Year 1.)
Recorded supplies expense. A physical count showed that $550 of supplies were still on hand.

Required a. Record the events and adjusting entries for Year 1 in general journal form.

b. Post the Year 1 events to T-accounts.

c. Prepare a trial balance for Year 1.

d-1. Prepare an income statement for Year 1.

d-2. Prepare a statement of changes in stockholders equity for Year 1.

d-3. Prepare a balance sheet for Year 1.

d-4. Prepare a statement of cash flows for Year 1.

e. Record the entries to close the Year 1 temporary accounts to Retained Earnings in the general journal and post to the T-accounts.

f. Prepare a post-closing trial balance for December 31, Year 1.