Question
Lee Chang opened Lee's Window Washing on July 1, 2014. In July, the following transactions were completed: July1 Lee invested $20,000 cash in the business.
Lee Chang opened Lee's Window Washing on July 1, 2014. In July, the following transactions were completed:
July1
Lee invested $20,000 cash in the business.
1
Purchased a used truck for $25,000, paying $5,000 cash and signing a note payable for the balance.
3
Purchased supplies for $2,100 on account.
5
Paid $1,800 on a one-year insurance policy, effective July 1.
12
Billed customers $4,500 for cleaning services.
18
Paid $1,400 of amount owed on supplies.
20
Paid $2,000 for employee salaries.
21
Collected $3,400 from customers billed on July 12.
25
Billed customers $9,000 for cleaning services.
31
Paid $550 for fuel for the month on the truck.
31
Withdrew $1,600 cash for personal use.
Instructions
(a)
Journalize and post the July transactions.
(b)
Prepare a trial balance at July 31.
(c)
Journalize and post the following adjustments:
1.
Earned but unbilled fees at July 31 was $1,500.
2.
The truck has an estimated useful life of four years.
3.
One-twelfth of the insurance expired.
4.
An inventory count shows $700 of supplies on hand at July 31.
5.
Accrued but unpaid employee salaries were $800.
6.
The note payable has a 5.5% annual interest rate.
(d)
Prepare an adjusted trial balance.
(e)
Prepare the income statement and statement of owner's equity for July, and a classified balance sheet at July 31, 2014. Of the note payable, $5,000 must be paid by July 1, 2015.
(f)
Journalize and post the closing entries.
(g)
Prepare a post-closing trial balance at July 31.
Lee Chang opened Lee's Window Washing on July 1, 2014. In July, the following transactions were completed:
|
Instructions
| (a) | Journalize and post the July transactions. |
| (b) | Prepare a trial balance at July 31. |
(c) | Journalize and post the following adjustments:
| |||||||||||||||||||||||||||
| (d) | Prepare an adjusted trial balance. |
(e) | Prepare the income statement and statement of owner's equity for July, and a classified balance sheet at July 31, 2014. Of the note payable, $5,000 must be paid by July 1, 2015. | |
| (f) | Journalize and post the closing entries. |
(g) | Prepare a post-closing trial balance at July 31. |
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