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 $30,000 cash and computer equipment worth $20,000 in the company in exchange for common stock. 2 The company rented furnished office space by paying $1,800 cash for the first month's (April) rent. 3 The company purchased $1,000 of office supplies for cash. 10 The company paid $2,400 cash for the premium on a 12-month insurance policy. Coverage begins on April 11. 14 The company paid $1,600 cash for two weeks' salaries earned by employees. 24 The company collected $8,000 cash for commissions earned. 28 The company paid $1,600 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 $750 cash for this month's telephone bill. 30 The company paid $1,500 cash in dividends. The company's chart of accounts follows. 101 Cash 106 Accounts Receivable 124 Office Supplies 128 Prepaid Insurance 167 Computer Equipment 168 Accumulated Depreciation-Computer Equip. 209 Salaries Payable 307 Common Stock 318 Retained Earnings 319 Dividends 405 Commissions Earned 612 Depreciation Expense-Computer Equip. 622 Salaries Expense 637 Insurance Expense 640 Rent Expense 650 Office Supplies Expense 684 Repairs Expense 688 Telephone Expense 901 Income Summary Use the following information: a. Prepaid insurance of $133 has expired this month. b. At the end of the month, $600 of office supplies are still available. c. This month's depreciation on the computer equipment is $500. d. Employees earned $420 of unpaid and unrecorded salaries as of month-end. e. The company earned $1,750 of commissions that are not yet billed at month-end. Required: 1. & 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. 3. Using account balances from Requirement 6b, prepare an unadjusted trial balance as of April 30. 4. 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 earnings for the month of April 30. 5c. Prepare the balance sheet at April 30. 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. Complete this question by entering your answers in the tabs below. Req 1 and Req3 Req 4 Adj Req 4 Adj Entries Trial Bal Req 5A Req 5B Req 5C Req 6A Req 6B GL Reg 7 Using account balances from Requirement 6b, prepare an unadjusted trial balance as of April 30. Credit Debit 27,000 08 1,000 2,400 20,000 ADVENTURE TRAVEL Unadjusted Trial Balance April 30 Account Title 101: Cash $ 106: Accounts receivable 124: Office supplies 128: Prepaid insurance 167: Computer equipment 168: Accumulated depreciation Computer equipment 209: Salaries payable 307: Common stock 318: Retained earnings 319: Dividends 405: Commissions earned 612: Depreciation expense-Computer equipment 622: Salaries expense 637: Insurance expense 640: Rent expense 650: Office supplies expense 684: Repairs expense 688: Telephone expense Total $ $ 50,000 0x 1,500 8,000 0X 3,200 1,800 350 750 58,000 $ 58,000 General Ledger accounts 101: Cash Debit 30,000 106: Accounts receivable Debit Credit Credit Balanc Date April 30 x 1,800 1,000 2,400 Date April 1 April 2 April 3 April 10 April 24 April 28 April 29 April 14 April 30 April 30 Balance 30,000 28,200 27,200 24,800 32,800 31,200 30,850 29,250 8 ,000 100000 1,600 350 1,600 128: Prepaid insurance Debit Credit Date Balanc Date April 3 April 30 Adj. 124: Office supplies Debit Credit 1,000 400 Balance 1,000 600 167: Computer equipment Debit Credit 2 0,000 168: Accumulated depreciation-Computer equ Debit Credit Balanc Date April 1 Date Balance 20,000 209: Salaries payable Debit Credit 420 307: Common stock Debit Credit Date Date April 30 Adj. Balanc Balance 420 318: Retained earnings Debit Credit 319: Dividends Debit Credit Balance Date Balanc Date April 30 Close 405: Commissions earned Debit Credit 8,000 612: Depreciation expense-Computer equip. Date Debit Credit Balanc Date April 24 April 30 Close Balance 8,000 637: Insurance expense Debit Credit Date Balanc Date April 14 April 28 April 30 Close 622: Salaries expense Debit Credit 1,600 1,600 Balance 1,600 3,200 640: Rent expense Debit Credit 1,800 650: Office supplies expense Debit Credit Date April 2 Balanc Balance 1,800 Date April 30 Close 684: Repairs expense Debit Credit 688: Telephone expense Debit Credit Date Balance Date Balanc Req 1 and Req 3 Req 4 Adj Req 4 Adj Entries Trial Bal Req 5A Req 58 Req 5C Reg 6A Req 6B GL Reg 7 Prepare journal entries to close the temporary accounts and then post to Req 6B General Ledger, using April 30 Close as the date. No General Journal Credit Date April 30 Debit 9,750 Commissions earned Income summary 9,750 April 30 Income summary 7,553 Rent expense Salaries expense Repairs expense Telephone expense Insurance expense Office supplies expense Depreciation expenseComputer equip. 1,800 3,620 350 750 133 400 500 April 30 2,1971 Income summary Retained earnings 2,197 April 30 1,500 Retained earnings Dividends 1,500 Complete this question by entering your answers in the tabs below. Req 1 and Req 3 Req 4 Adj Req 4 Adj Entries Trial Bal Req 5A Req 5B Req 5C Req 6A Req 6B GL Req 7 Prepare the income statement for the month of April 30. ADVENTURE TRAVEL Income Statement For Month Ended April 30 Revenues: Commissions earned $ 9,750 Expenses: Depreciation expense-Computer equip. Salaries expense Insurance expense Rent expense Telephone expense Office supplies expense Repairs expense 500 3,620 1331 1,800 750 400 350 ) Total expenses 7,553 2,197 Net income $ 684: Repairs expense Debit Credit 1,800 X Date April 2 Balanc Balance 1,800 688: Telephone expense Debit Credit 750 Date April 30 x Req 1 and Req3 Req 4 Adj Req 4 Adj Entries Trial Bal Req 5A Req 5B Req 5C Req 6A Req 6B GL Req 7 Prepare a post-closing trial balance... Credit ADVENTURE TRAVEL Post-Closing Trial Balance April 30 Account Title Cash $ Accounts receivable Computer equipment Office supplies Prepaid insurance Accumulated depreciationComputer equip. Salaries payable Retained earnings 00000000 Debit 27,000 1,750 20,000 600 2,267 $ 500 420 50,697 X Totals $ 51,617 $ 51,617 |