Complete Accounting Cycle

For the past several years, Jeff Horton has operated a part-time consulting business from his home. As of April 1, 20Y6, Jeff decided to move to rented quarters and to operate the business, which was to be known as Rosebud Consulting, on a full-time basis. Rosebud entered into the following transactions during April:

Apr. 1. The following assets were received from Jeff Horton in exchange for common stock: cash, $20,000; accounts receivable, $14,700; supplies, $3,300; and office equipment, $12,000. There were no liabilities received.

1. Paid three months rent on a lease rental contract, $6,000.

2. Paid the premiums on property and casualty insurance policies, $4,200.

4. Received cash from clients as an advance payment for services to be provided and recorded it as unearned fees, $9,400.

5 Purchased additional office equipment on account from Smith Office Supply Co., $8,000

6 Received cash from clients on account, $11,700.

10 Paid cash for a newspaper advertisement, $350.

12 Paid Smith Office Supply Co. for part of the debt incurred on April 5, $6,400.

12 Recorded services provided on account for the period April 112, $21,900.

14 Paid receptionist for two weeks salary, $1,650.

Record the following transactions on Page 2 of the journal:

17 Recorded cash from cash clients for fees earned during the period April 116, $6,600.

18 Paid cash for supplies, $725.

20 Recorded services provided on account for the period April 1320, $16,800.

24 Recorded cash from cash clients for fees earned for the period April 1724, $4,450.

26 Received cash from clients on account, $26,500.

27 Paid receptionist for two weeks salary, $1,650.

29 Paid telephone bill for April, $540.

30 Paid electricity bill for April, $760.

30 Recorded cash from cash clients for fees earned for the period April 2530, $5,160.

30 Recorded services provided on account for the remainder of April, $2,590.

30 Paid dividends, $18,000.

Required:

1. Journalize each transaction in a two-column journal starting on Page 1, referring to the following chart of accounts in selecting the accounts to be debited and credited. If there is more than one entry on the same date, be sure to enter the transactions in the exact order as presented in the data. (Do not insert the account numbers in the journal at this time.) If an amount box does not require an entry, leave it blank.

11 Cash 31 Common Stock

12 Accounts Receivable 32 Retained Earnings

14 Supplies 33 Dividends

15 Prepaid Rent 41 Fees Earned

16 Prepaid Insurance 51 Salary Expense

18 Office Equipment 52 Supplies Expense

19 Accumulated Depreciation 53 Rent Expense

21 Accounts Payable 54 Depreciation Expense

22 Salaries Payable 55 Insurance Expense

23 Unearned Fees 59 Miscellaneous Expense

You will use the attached spreadsheet to complete several of the remaining parts of this problem. Click on the Spreadsheet icon above to open and save the Excel file to your computer. Your input into the spreadsheet will not be included in your grade in CengageNOW on this problem.

2. Post the transactions from part 1 to the general ledger in the attached spreadsheet. The posting must be in chronological order. Be sure to go back and enter the appropriate posting references in the journal.

3. In the spreadsheet, prepare an unadjusted trial balance.

4. At the end of April, the following adjustment data were assembled. Analyze and use these data to complete parts (5) and (6).

a. Insurance expired during April is $350.

b. Supplies on hand on April 30 are $1,225.

c. Depreciation of office equipment for April is $400.

d. Accrued receptionist salary on April 30 is $275.

e. Rent expired during April is $2,000.

f. Unearned fees on April 30 are $2,350.

5. (Optional) In the spreadsheet, enter the unadjusted trial balance on the end-of-period worksheet and complete the worksheet.

6. Journalize the adjusting entries on Page 3 of the journal. (Do not insert the account numbers in the journal at this time.) Post the adjusting entries to the general ledger in the spreadsheet. The posting must be in chronological order. Then go back and enter the appropriate posting references in the journal.

7. In the spreadsheet, prepare the adjusted trial balance.

8. Prepare an income statement, a statement of stockholders equity, and a balance sheet. If an amount box does not require an entry, leave it blank. If a net loss is incurred or dividends were paid, enter that amount as a negative number using a minus sign.

9. Journalize the closing entries on Page 4 of the journal. (Do not insert the account numbers in the journal at this time.) Post the closing entries to the general ledger in the spreadsheet. Then go back and enter the appropriate posting references in the journal. If an amount box does not require an entry, leave it blank.

10. Prepare a post-closing trial balance. List the accounts in order by type: Assets, Liabilities, Capital, Dividends, Revenue, and Expenses. If an amount box does not require an entry, leave it blank.

od 2. JOURNAL Page 1 Darcriptis Purt. Ref. Debit Credit Dat 20T6 April 1 #### 1 # ## 2 # # 4 # 5 # # 6 # 10 # # 12 # 12 # # 14 # # JOURNAL Page 2 Post. Ref. Description Debit Credit 54 55 56 57 8 59 50 #### ## # n #### #### ## #### #### # #### 2 53 4 5 56 ## #### #### # #### ## #### # 58 9 #### #### De ## # #### #### #### -3 ## # 25 #### #### #### ## - - - - - -- + N - 6 - # #### #### #### ## 82 be # ## # #### #### #### ## 2 83 # #### ## 35 86 # #### #### #### #### # ## ## 88 89 # ## GENERAL LEDGER Post. Ref. 11 Balance Credit Item Debit Credit Debit ## ## ## ## ## ## ## ## ## ## ## ## ## ## ## ## ## unts Receivable Post Ref. 12 Balance Credit Item Debit Credit Debit ## ## ## ## ## ## ies Post. Ref. 14 Balance Credit Item Debit Credit Debit ## ## ## ## Adjusting id Rent Post. Ref. 15 Balance Credit Item Debit Credit Debit ## ## Adjusting id Insurance Post. Ref. 16 Balance Credit Item Debit Credit Debit ## ## Adjusting Equipment Post. Ref. 18 Balance Credit Item Debit Credit Debit ## ## nulated Depreciation Post. Ref. 19 Balance Credit Item Debit Credit Debit Adjusting # unts Payable Post. Ref. 21 Balance Credit Item Debit Credit Debit # es Payable Post. Ref. 22 Balance Credit Item Debit Credit Debit Adjusting # ned Fees Post. Ref. 23 Balance Credit Item Debit Credit Debit # Adjusting # on Stock Post. Ref. 31 Balance Credit Item Debit Credit Debit # red Earnings Post. Ref. 32 Balance Credit Item Debit Credit Debit 0 # Closing Closing # -nds Post. Ref. 33 Balance Credit Item Debit Credit Debit ## ## Closing Earned Post. Ref. 41 Balance Credit Item Debit Credit Debit # # Adjusting Closing Expense 51 Post. Ref. Balance Credit Item Debit Credit Debit ## ## ## ## Adjusting Closing Jes Expense Post. Ref. 52 Balance Credit Item Debit Credit Debit Adjusting Closing ## ## pense 53 Post. Ref. Balance Credit Item Debit Credit Debit Adjusting Closing ## ## iation Expense Post. Ref. 54 Balance Credit Item Debit Credit Debit Adjusting Closing ## ## ce Expense 55 Post. Ref. Balance Credit Item Debit Credit Debit Adjusting Closing ## ## aneous Expense Post. Ref. 59 Balance Credit Item Debit Credit Debit ## ## ## ## Closing Debit Balances Rosebud Consulting Unadjusted Trial Balance April 30, 2016 Acct. No. Cash 11 Accounts Receivable 12 Supplies 14 Prepaid Rent 15 Prepaid Insurance 16 Office Equipment 18 Accumulated Depreciation 19 Accounts Payable 21 Salaries Payable 22 Unearned Fees 23 Common Stock 31 Retained Earnings 32 Dividends 33 Fees Earned 41 Salary Expense 51 Supplies Expense 52 Rent Expense 53 Depreciation Expense 54 Insurance Expense 55 Miscellaneous Expense 59 Credit Balances ## ## ## ## ## ## ## ## ## ## ## ## ## ## ## ## ## ## ## ## ## Income Statement Debit Credit Balance Sheet Debit Credit Jnadjusted Trial Balance Debit Credit 43,535 17,790 4,025 6,000 4,200 20,000 1,600 Account Title Cash Accounts Receivable Supplies Prepaid Rent Prepaid Insurance Office Equipment Acoum. Depreciation Accounts Payable Salaries Payable Unearned Fees Common Stock Retained Earnings Dividends Fees Earned Salary Expense Supplies Expense Rent Expense Depreciation Expense Insurance Expense Miscellaneous Expense Rosebud Consulting End-of-Period Spreadsheet (Work Sheet) For the Month Ended April 30, 2016 Adjusted Adjustments Trial Balance Debit Credit Debit Credit ## # ## # ## # ## # ## # ## # ## # ## # ## # ## # ## # ## # ## # ## # ## # ## # ## # ## # ## # ## # ## 9,400 50,000 18,000 57,500 3,300 1,650 118,500 #REF! 118,500 # JOURNAL Page 3 Post. Ref. Debit Credit Description Adjusting Entries ## ## ## ## ## I INN II ## ## ## ## Debit Balances Credit Balances ## ## ## ## ## ## ## Cash Accounts Receivable Supplies Prepaid Rent Prepaid Insurance Office Equipment Accumulated Depreciation Accounts Payable Salaries Payable Unearned Fees Common Stock Retained Earnings Dividends Fees Earned Salary Expense Supplies Expense Rent Expense Depreciation Expense Insurance Expense Miscellaneous Expense Rosebud Consulting Adjusted Trial Balance April 30, 2016 Acct. No. 11 12 14 15 16 18 19 21 22 23 31 32 33 41 51 52 53 54 55 59 ## ## ## ## ## ## ## ## ## ## ## ## ## Rosebud Consulting Income Statement For the Month Ended April 30, 2016 Revenues: #### Expenses ## ## ## ## ## #### #### #### #### #### #### ## #C Total expenses Net income # ## ## Total Rosebud Consulting Statement of Stockholders' Equity For the Month Ended April 30, 2016 Commo Retaine in Stock d Balances, April 1, 2016 Issued common stock Net income Dividends Balances, April 30, 2046 ## ## ## ## ## F F Rosebud Consulting Balance Sheet April 30, 2016 Assets Current assets: #### #### #### #### #### ## ## Total current assets Property, plant, and equipment: #### #### Total property, plant, and equipment Total assets * ## ## Liabilities Current liabilities: #### #### Total liabilities ## Stockholders' Equity ' #### #### Total stookholders' equity ## 11 Total liabilities and stockholders'equity ## JOURNAL Page 4 Post. Ref. Debit Credit Description Closing Entries ## ## ## ## ## ## # # # #### ## ## Rosebud Consulting Post-Closing Trial Balance April 30, 2046 Debit Balances Acct. No. 11 12 16 Cash Accounts Receivable Supplies Prepaid Rent Prepaid Insurance Office Equipment Accumulated Depreciation Accounts Payable Salaries Payable Unearned Fees Common Stock Retained Earnings 4 Credit Balances ## ## ## ## ## ## ## ## ## ## ## ## ## 22 23 31 32