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On April 1, 2017, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the companys first month. April 1 Nozomi
On April 1, 2017, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the companys first month.
April | 1 | Nozomi invested $40,000 cash and computer equipment worth $30,000 in the company. | ||
2 | The company rented furnished office space by paying $2,700 cash for the first months (April) rent. | |||
3 | The company purchased $1,700 of office supplies for cash. | |||
10 | The company paid $2,300 cash for the premium on a 12-month insurance policy. Coverage begins on April 11. | |||
14 | The company paid $900 cash for two weeks' salaries earned by employees. | |||
24 | The company collected $24,000 cash on commissions from airlines on tickets obtained for customers. | |||
28 | The company paid $900 cash for two weeks' salaries earned by employees. | |||
29 | The company paid $400 cash for minor repairs to the company's computer. | |||
30 | The company paid $850 cash for this month's telephone bill. | |||
30 | Nozomi withdrew $2,000 cash from the company for personal use. |
The company's chart of accounts follows:
101 | Cash | 405 | Commissions Earned |
106 | Accounts Receivable | 612 | Depreciation ExpenseComputer Equip. |
124 | Office Supplies | 622 | Salaries Expense |
128 | Prepaid Insurance | 637 | Insurance Expense |
167 | Computer Equipment | 640 | Rent Expense |
168 | Accumulated DepreciationComputer Equip. | 650 | Office Supplies Expense |
209 | Salaries Payable | 684 | Repairs Expense |
301 | J. Nozomi, Capital | 688 | Telephone Expense |
302 | J. Nozomi, Withdrawals | 901 | Income Summary |
Use the following information:
- Two-thirds (or $128) of one months insurance coverage has expired.
- At the end of the month, $600 of office supplies are still available.
- This months depreciation on the computer equipment is $400.
- Employees earned $380 of unpaid and unrecorded salaries as of month-end.
- The company earned $2,000 of commissions that are not yet billed at month-end.
Required: 6a. Prepare journal entries to close the temporary accounts and then post to Requirement 6b. 6b. Post the journal entries to the ledger. 7. Prepare a post-closing trial balance.
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