Question
Molly Smith opened Mollys Cleaning Services on June 1. During the month ofJune, the following transactions were completed:June 1 Invested $15,000 cash in the businessJune
Molly Smith opened Mollys Cleaning Services on June 1. During the month ofJune, the following transactions were completed:June 1 Invested $15,000 cash in the businessJune 2 Purchased a ute for $10,500 + GST, paying $3,500 cash & thebalance on account.June 4 Purchased cleaning supplies for $1,320 (inclusive of GST) onaccountJune 8 Paid $1,800 cash on one year insurance policy effective June 1.(The amount includes GST of $60)June 13 Billed customers $3,520 for cleaning services (incl. of GST). Terms2/10 net 30June 20 Paid $1,600 cash on amount owed on truck & $550 on amountowed on cleaning supplies.June 21 Paid $1,850 cash for employee salaries.June 23 Collected $1,960 cash from customers billed on June 13. Thesecustomers had availed of the sales discount.June 27 Billed Customers $3,080 for cleaning services (incl. of GST).Terms 2/10 net 30.June 30 Paid gas & oil for the truck $165 inclusive of GST.June 30 Withdrew $850 for personal use.Note: Mollys Cleaning Services is registered for GST.Required:a) Journalise the June transactions. (Marks: 8)b) Prepare a trial balance on a worksheet (Marks: 5.25)c) Enter the following adjustments on the work sheet & complete theworksheet. 1) Earned but unbilled revenue at June 30 was $950(excl. GST) 2) Depreciation on the truck for the month was $185 3) An inventory count showed $750 of the cleaning supplies werestill on hand. 4) Accrued but unpaid employee wages were $550. 5) One months insurance expired.
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