Financial Accounting with IFRS 4/e (Kieso) ACR4.1

Jaden Li opened Kleene Window Washing on July 1, 2020. During July, the following transactions were completed.

July 1 Shareholders invested NT$12,000 cash in the business in exchange for ordinary shares. July 2 Purchased used truck for NT$8,000, paying NT$2,000 cash and the balance on account. July 3 Purchased cleaning supplies for NT$900 on account.

July 5 Paid NT$1,800 cash on a 1-year insurance policy effective July 1. July 12 Billed customers NT$3,700 for cleaning services performed. July 18 Paid NT$1,000 cash on amount owed on truck and NT$500 on amount owed on cleaning supplies. July 20 Paid NT$2,000 cash for employee salaries.

July 21 Collected NT$1,600 cash from customers billed on July 12.

July 25 Billed customers NT$2,500 for cleaning services performed.

July 31 Paid NT$290 for maintenance of the truck during month.

July 31 Declared and paid a NT$600 cash dividend.

The chart of accounts for Kleene Window Washing contains the following accounts: Cash, Accounts Receivable, Supplies, Prepaid Insurance, Equipment, Accumulated Depreciationequipment, Accounts Payable, Salaries and Wages Payable, Share Capital-Ordinary, Retained Earnings, Dividends, Income Summary, Service Revenue, Maintenance and Repairs expense, Supplies Expense, Depreciation Expense, Insurance Expense, and Salaries and Wages Expense.

Instructions:

a. Journalize the July transactions.

b. Post to the ledger accounts. (Use T-accounts.)

c. Prepare a trial balance at July 31.

d. Journalize the following adjustments.

1. Services performed but unbilled and uncollected at July 31 were NT$1,700.

2. Depreciation on equipment for the month was NT$180.

3. One-twelfth of the insurance expired.

4. A count shows NT$320 of cleaning supplies on hand at July 31.

5. Accrued but unpaid employee salaries were NT$400.

e. Post adjusting entries to the T-accounts.

f. Prepare an adjusted trial balance.

g. Prepare the income statement and a retained earnings statement for July and a classified statement of financial position at July 31.

h. Journalize and post closing entries and complete the closing process.i. Prepare a post-closing trial balance at July 31.

i. Prepare a post-closing trial balance at July 31.