Discuss the significance of the contracting discussion between Brett and the large buildings manager concerning the window-washing contract. What amount should be shown on the books of record for Bretts corporation and when?

Discuss the significance (if any) of Bretts truck repair appointment for September 13 to the accounting records?

You are Bretts business advisor. Discuss the significant issues involved in the employees salary request. What would you advise Brett to do?

#	Day	Description
1	1	Issued $9,000 of common stock for $9,000 of cash.
2	1	Purchased used truck for $6,000, paying $3,000 in cash and the balance on account.
3	3	Purchased cleaning supplies for $900 on account.
4	5	Paid $1,200 cash on a 1-year insurance policy, effective July 1.
5	12	Billed customers $2,500 for cleaning services.
6	13	Brett got a phone call from a manager of a large office building (Axis Building). The manager asked Brett to prepare a bid sheet for washing all of his windows 4 times per month.
7	18	Paid $1,000 cash on amount owed on truck and $500 on amount owed on cleaning supplies.
8	20	Paid $1,200 cash for employee salaries.
9	20	Brett met with the manager of the large office building (Axis Building) and submitted a bid of $5,500 for complete window washing maintenance 4 times per month. The manager liked the bid but had to discuss this large a contract with the owner. Brett is almost sure the work will come in starting August 1.
10	21	Collected $1,400 cash from customers billed on July 12.
11	25	Billed customers $2,000 for cleaning services.
12	26	Brett got a phone call from the manager of the Axis Building. The owner was willing to pay $5,000 per month for 4 window washings. Brett considered the offer and said it seemed acceptable for him. The manager said to bring over the contract and start during the week of August 5th.
13	31	Paid cash for gas and oil for month for truck of $200.
14	31	When he picked up the truck after servicing the maintenance man told him the truck should be winterized before November. The cost for all the work would be $75. Brett made an appointment for winterization of the truck on September 13.
15	31	Declared and paid a $300 dividend.
16	31	An employee approached Brett with a salary request. The employee was willing to work for $3 less an hour if Brett would pay the salary under the table. The employees spouse had a good job and the salary the employee was getting would put the family into a new income tax bracket. The employee was a good employee and would have to quit if Brett did not oblige. Brett saw the savings opportunity but said hed have to talk to his advisor.

In addition the following adjustments were necessary

#	Day	Description
17	31	Services provided but unbilled and uncollected at July 31 were $1,100.
18	31	Depreciation on equipment for month was $200.
19	31	One-twelfth of the insurance expired.
20	31	An inventory count shows $600 of cleaning supplies on hand.
21	31	Accrued but unpaid employee salaries were $400.

Cornelian Window Washing Inc. Chart of Accounts:

100 Cash Cash in bank and in petty cash funds

120 Accounts Receivable Revenue billed but not yet received

130 Cleaning Supplies Supplies used in the cleaning business

140 Prepaid Insurance Insurance policy for the operations of the business

150 Equipment Equipment used in the operations of the business

155 Accumulated Depreciation - Equipment

Amounts of equipment values previously assigned as an expense of business. (Contra Account)

200 Accounts Payable

Amounts owed by the business for items purchased and delivered but not paid for.

210 Salaries Payable Amounts owed to employees of business for wages

300 Common Stock Ownership investment

310 Retained Earnings Net income retained in the business

330 Dividends Amounts paid to stockholders during the period.

340 Income Summary Clearing account to close nominal accounts

400 Service Revenue Revenues for operating purpose of the company

500 Gas & Oil Expense Cost of operating equipment fuel and oil

510 Cleaning Supplies Expense Expense of cleaning supplies

520 Depreciation Expense Amounts recognized as equip. expense

530 Insurance Expense Amounts recognized as insurance used

540 Salaries Expense Amounts owed / or paid/ to employees