Kelly Pitney began her consulting business, Kelly Consulting, on April 1, 2018. The accounting cycle for Kelly Consulting for April, including financial statements, was illustrated in this chapter. During May, Kelly Consulting entered into the following transactions: May 3 Received cash from clients as an advance payment for services to be provided and recorded it as unearned fees, $4,500. 5 Received cash from clients on account, $2,450. 9 13 15 Paid cash for a newspaper advertisement, $225. Paid Office Station Co. for part of the debt incurred on April 5, $640. Recorded services provided on account for the period May 1-15, $9,180. Paid part-time receptionist for two weeks' salary including the amount owed on April 30, $750. Recorded cash from cash clients for fees earned during the period May 1-16, $8,360. 16 17 Record the following transactions on Page 6 of the journal: May 20 Purchased supplies on account, $735. Recorded services provided on account for the period May 16-20, $4,820. 21 25 Recorded cash from cash clients for fees earned for the period May 17-23, $7,900. Received cash from account, $9,520. 28 30 Paid part-time receptionist for two weeks' salary, $750. Paid telephone bill for May, $260. Paid electricity bill for May, $810. 31 31 Recorded cash from cash clients for fees earned for the period May 26-31, $3,300. 31 Recorded services provided on account for the remainder of May, $2,650. 31 Paid dividends, $10,500. Required: 1. The chart of accounts is shown in a separate panel and the post-closing trial balance as of April 30, 2018, is shown below. A. Download the spreadsheet in the Ledger panel and save the Excel file to your computer. Be sure to save your work in Excel as it will be used to complete the following steps in Part 1 of this problem as well as steps in Part 2 of this problem. Your input into the spreadsheet will not be included in your grade in CengageNOW on this problem. For each account in the post-closing trial balance, enter the balance in the appropriate Balance column of the four-column account. Date the balances May 1, enter Balance in the item column and select a check mark in the Posting Reference column. B. Journalize each of the May transactions in the two-column journal starting on Page 5 of the journal. Refer to the Chart of Accounts for exact wording of account titles. (Do not insert the account numbers in the journal at this time.) 2. Post the journal entries on pages 5 and 6 of the journal to the ledger of four-column accounts. Enter the appropriate Posting References in the journal and the ledger. No entry is necessary in the item column. 3. Prepare an unadjusted trial balance. 4. At the end of May, the following adjustment data were assembled. Analyze and use these data to complete parts (5) and (6). Insurance expired during May is $275. Supplies on hand on May 31 are $715. Depreciation of office equipment for May is $330. Accrued receptionist salary on May 31 is $325. Rent expired during May is $1,600. Unearned fees on May 31 are $3,210. Depreciation of office equipment for May is $330. Accrued receptionist salary on May 31 is $325. Rent expired during May is $1,600. Unearned fees on May 31 are $3,210. 5. (Optional) on your own paper or spreadsheet, enter the unadjusted trial balance on a 10-column end-of-period spreadsheet (work sheet), and complete the spreadsheet. 6. A. Journalize the adjusting entries on Page 7 of the journal. Refer to the Chart of Accounts for exact wording of account titles. B. Post the adjusting entries to the ledger. Enter the appropriate Posting References in the journal and the ledger. No entry is necessary in the item column. 7. Prepare an adjusted trial balance. Kelly Consulting POST-CLOSING TRIAL BALANCE April 30, 2018 ACCOUNT TITLE DEBIT CREDIT 1 Cash 22,100.00 2 Accounts Receivable 3,400.00 3 Supplies 1,350.00 April 30, 2018 ACCOUNT TITLE DEBIT CREDIT 1 Cash 22,100.00 2 Accounts Receivable 3,400.00 3 Supplies 1,350.00 4 Prepaid Rent 3,200.00 5 Prepaid Insurance 1,500.00 6 Office Equipment 14,500.00 7 Accumulated Depreciation 330.00 8 Accounts Payable 800.00 9 Salaries Payable 120.00 10 Unearned Fees 2,500.00 11 Common Stock 30,000.00 12 Retained Earnings 12,300.00 13 Dividends 14 Income Summary 15 Totals 46,050.00 46,050.00 CHART OF ACCOUNTS Kelly Consulting General Ledger ASSETS REVENUE 11 Cash 41 Fees Earned 12 Accounts Receivable 14 Supplies EXPENSES 15 Prepaid Rent 51 Salary Expense 16 Prepaid Insurance 52 Rent Expense 18 Office Equipment 53 Supplies Expense 19 Accumulated Depreciation 54 Depreciation Expense 55 Insurance Expense LIABILITIES 59 Miscellaneous Expense 21 Accounts Payable 22 Salaries Payable 23 Unearned Fees EQUITY 31 Common Stock 32 Retained Earnings 33 Dividends 34 Income Summary JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 PAGE 6 JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 15 16 17 18 19 20 6. A. Journalize the adjusting entries on Page 7 of the journal (adjusting data can be found on the Instructions panel). Refer to the Chart of Accounts for exact wording of account titles. PAGE 7 JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 Adjusting Entries 2 3 4 JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 Adjusting Entries 2 3 4 5 6 7 8 9 10 11 12 13 Ledger Download the attached SPREADSHEET and save the Excel file to your computer. Use the spreadsheet to post the May transactions from the journal to a ledger of four-column accounts. Be sure to save your work in Excel as it will be used to complete the following steps in Part 1 of this problem as well as steps in Part 2 of this problem. Your input into the spreadsheet will not be included in your grade in CengageNOW on this problem. 1. A. For each account in the post-closing trial balance, enter the balance in the appropriate Balance column of a four-column account. Date the balances May 1, enter Balance in the Item column and select a check mark in the Posting Reference column. Do not make an entry in the Item column for any other entries in the ledger. 2. Post the journal entries on pages 5 and 6 of the journal to the ledger of four-column accounts. Enter the appropriate Posting References in the journal and the ledger. No entry is necessary in the item column. 6. B. Post the adjusting entries to the ledger. Enter the appropriate Posting References in the journal and the ledger. No entry is necessary in the item column. 3. Prepare an unadjusted trial balance. Accounts with zero balances can be left blank. Kelly Consulting UNADJUSTED TRIAL BALANCE May 31, 2018 ACCOUNT TITLE DEBIT CREDIT 1 Cash 2 Accounts Receivable 3 Supplies 4 Prepaid Rent 5 Prepaid Insurance 6 Office Equipment 1 Accumulated Depreciation 8 Accounts Payable 9 Salaries Payable 10 Unearned Fees 11 Common Stock 12 Retained Earnings 9 Salaries Payable 10 Unearned Fees 11 Common Stock 12 Retained Earnings 13 Dividends 14 Fees Earned 15 Salary Expense 16 Rent Expense 17 Supplies Expense 18 Depreciation Expense 19 Insurance Expense 20 Miscellaneous Expense 21 Totals 7. Prepare an adjusted trial balance. Accounts with zero balances can be left blank. Kelly Consulting ADJUSTED TRIAL BALANCE May 31, 2018 ACCOUNT TITLE DEBIT CREDIT 1 Cash 2 Accounts Receivable 3 Supplies 4 Prepaid Rent 5 Prepaid Insurance 6 Office Equipment 7. Accumulated Depreciation 8 Accounts Payable 9 Salaries Payable 10 Unearned Fees 11 Common Stock 12 Retained Earnings 13 Dividends 14 Fees Earned 13 Dividends 14 Fees Earned 15 Salary Expense 16 Rent Expense 17 Supplies Expense 18 Depreciation Expense 19 Insurance Expense 20 Miscellaneous Expense 21 Totals