Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

On April 1 , Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the company's first month. April 1 Nozomi

On April 1, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the company's first month.
April 1 Nozomi invested $45,000 cash and computer equipment worth $35,000 in the company in exchange for common stock.
2 The company rented furnished office space by paying $2,100 cash for the first month's (April) rent.
3 The company purchased $1,800 of office supplies for cash.
10 The company paid $2,000 cash for the premium on a 12-month insurance policy. Coverage begins on April 11.
14 The company paid $1,200 cash for two weeks' salaries earned by employees
24 The company collected $13,500 cash for commissions earned.
28 The company paid $1,200 cash for two weeks' salaries earned by employees.
29 The company paid $350 cash for minor repairs to the company's computer.
30 The company paid $1,350 cash for this month's telephone bill.
30 The company paid $2,100 cash in dividends.
The company's chart of accounts follows:
\table[[101,Cash,405,Commissions Earned],[106,Accounts Receivable,612,\table[[Depreciation Expense-Computer],[Equip.]]],[124,office Supplies,622,Salaries Expense],[128,Prepaid Insurance,637,Insurance Expense],[167,Computer Equipment,640,Rent Expense],[168,\table[[Accumulated],[Depreciation-Computer Equip.]],650,Office Supplies Expense],[209,Salaries Payable,684,Repairs Expense],[307,Common Stock,688,Telephone Expense],[318,Retained Earnings,901,Income Summary],[319,Dlvidends,,]]
Use the following information:
Prepaid insurance of $111 has expired this month.
At the end of the month, $500 of office supplies are still available.
This month's depreciation on the computer equipment is $400.
Employees earned $450 of unpaid and unrecorded salaries as of month-end.
The company earned $1,900 of commissions that are not yet billed at month-end.
Required:
& 2. Prepare journal entries to record the transactions for April and post them to the ledger accounts in Requirement 6b. The company records prepaid and unearned items in balance sheet accounts.
Using account balances from Requirement 6b, prepare an unadjusted trial balance as of April 30.
Journalize the adjusting entries for the month and prepare the adjusted trial balance.
5a. Prepare the income statement for the month of April 30.
5b. Prepare the statement of retained eamings for the month of April 30.
5c. Prepare the balance sheet on April 30.1
6a. Prepare joumal entries to close the temporary accounts and then post to Requirement 6b.
6b. Post the journal entries to the ledger.
Prepare a post-closing trial balance.
image text in transcribed

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

Recommended Textbook for

Financial accounting

Authors: Walter T. Harrison, Charles T. Horngren, William Bill Thomas

8th Edition

9780135114933, 136108865, 978-0136108863

More Books

Students also viewed these Accounting questions

Question

Explain the seven dimensions of an organizations climate.

Answered: 1 week ago

Question

Describe the five types of change.

Answered: 1 week ago