Instructions:

1. Journalize and post the transactions noted below for Bayou Consultants during the firms

   first month of Business. NOTE: Use the account titles and numbers in the chart of

   account provided and round all calculations to the nearest whole dollar.

2. Prepare a 10- column worksheet using your knowledge of what has taken place during

   January and the supplemental adjusting entry information provided.

3. Journalize and post all indicated adjusting entries

4. Journalize and post all closing entries

5. Prepare an income statement, balance sheet, and statement of retained earnings in

   good form. Note: Blank statements are not provided, use a spreadsheet program to

   prepare the required statements.

6. Prepare a post closing trial balance.

TRANSACTIONS: January 1. Issued 15,000 shares of $10 par value common stock in exchange for an initial

investment of $320,000 by the firms owners, Siam Gato and Scotty Phideaux January 1. Purchased land and an office building for $176,000, of which $70,000 was Attributable to the fair market value of the building. A $35,000 cash down

payment was made and an 5% five- year note was signed for the balance. Interest and 20% of the principal will be paid annually on this date. (Assume a 360-day year for interest computation purposes.)

January 3. Issued 2,200 shares of $10 par value stock for office equipment with a fair market value of $24,879

January 5. January 6. January 7. January, February, and March. The advertising, which cost $1,500, was paid for on this date in order to obtain a lower price.

Purchased office supplies of $2,900 on account from Kilycone Office Supplies. Establish a petty cash fund of $300

Placed an order in the local newspaper for advertising, which will run during

January 8. Purchased a one year policy effective feb 1 for $2400 January 10. Completed several consulting jobs which totaled $36,000. Cash of $12,800 was collected with the balance due in 30 days. January 15. Paid the semi monthly payroll, which totaled $16,000, to the firms consultants, all of which are classified as independent contractors.

January 16. January 19. January 30. January 31. January 31. January 31. $41,000. $30,000 was collected in cash with the balance due in 30 days. January 31. An audit of the petty cash fund determined the following

Declared a cash dividend of $.30 per share on this date payable on Febuary 18. Paid Kilcoyne Office supply $1,500 on the account balance.

Received the January telephone bill for $315 Paid the payroll for the second half of january

Received various utility bills for January, which totaled $340 Recorded consulting jobs completed during the last half of January that totaled

Receipts Postage (Dr)$62

Freight out

Misc. exp Currency and coin

(cr)$76 (cr) $38

(Cr)$119 The appropriate entry was recorded from the information above.

SUPPLEMENTAL ADJUSTING ENTRY INFROMATION:

1. Aninventoryofofficesupplieswasfoundthat$2300ofsuppliesremainedatJanuary31.

2. Thebuildingwillbedepreciatedonastraightlinebasisover30yearswithnosalvage

   value.

3. Theequipmentwillbedepreciatedonastraightlinebasisover10yearswithnosalvage

   value.

4. Aninvoiceforarepairof$450ontheofficeequipmentdatedJanuary26hadnotyet

   been recorded.

5. Incometaxexpenseof27%willberecordedonpretaxaccountingincome.

6. The dividends account will not be closed until the end of the year.

7. Be aware that there might be other adjustments necessary in addition to those indicated

   in items a through f above.

   CHART OF ACCOUNTS Cash Petty cash Accounts receivable Notes receivable Notes receivable Interest receivable Office supplies Prepaid insurance Prepaid advertising Office equipment Accumulated depreciation, office equipment Building Accumulated depreciation, building Land Accounts payable Dividends payable Income tax payable Notes payable Interest payable Common stock Paid in capital in excess of par value Retained earnings Dividends Consulting revenue Interest revenue

Payroll expense Advertising expense Insurance expense Interest expense Payroll expense Advertising expense Insurance expense Interest expense Telephone expense Utilities expense Repairs expense Postage expense Freight out Supplies expense Depreciation expense, office equipment Depreciation expense, building Miscellaneous expense Income tax expense Cash over and short Income summary