Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Majid is a fresh graduate from Business School and he is planning to start up his own business by establishing consulting firm specialized in marketing

image text in transcribed
image text in transcribed
Majid is a fresh graduate from Business School and he is planning to start up his own business by establishing consulting firm specialized in marketing research. To make sure that his business operating well; Majid hired an experienced accountant to handle day to day financial transactions and prepare financial statements by end of the period to help Majid in decision making regarding the future of his business. Majid and the new accountant agreed to issue monthly financial statements so that Majid can be updated on his operating results and financial position every month in order to monitor, evaluate and act regarding any up normal situations. During October 2018; the first month of operation the following transactions were noticed: 1. Majid invested cash 150,000 in share capital to start up his business 2. Purchased an accounting software program for 1,200; a cash payment of 400 was made on the date of purchase and issued a 3 month note payable for the rest. Interest rate that must be paid is 12% annual 3. Paid 3,600 for annual rent 4. Purchased office furniture for 4,000 cash 5. Received 6,000 cash on agreement to perform a market survey on Jeddah's university students. 6. Purchased a computer for 3,000 cash. 7. Paid 6,000 the accountant monthly salary. 8. Conducted a research for Panda Stores for 9,800. The bill sent to Panda directly. 9. Signed a contract with Face Book to for electronic advertising about Majid's firm, the contract stated that each electronic advertising published will cost Majid 500. 10. Panda Stores paid 2,000 cash. 11. Paid 1,000 dividends. Required: 1. Record all previous transactions in journal entries. 2. Post all transactions to ledger accounts. 3. Prepare trial balance. 4. Record adjusting entries for the month of October taking into consideration the following information: a. The computer is depreciated at 300 annuals b. furniture is depreciated at 100 monthlies c. Interest on note payable has not been paid d. Rent is to be adjusted monthly c. By end of October Majid didn't started the surve vet f. Face Book published 10 electronic advertisements and no payments has been paid. 5. Prepare adjusted trial balance. 6. Prepare income statement, statement of retained earnings and statement of financial position. 7. Record all closing entries

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Accounting questions

Question

10. Describe the relationship between communication and power.

Answered: 1 week ago