On June 1, 2017, Andy Miller started his consulting firm, Miller & Associates, Inc. The firm is a service company, but also sells workbooks, manuals, and textbooks as part of its consulting services. The following transactions occurred during the companys first month. Miller & Associates, Inc. uses a perpetual inventory system. June 1 June 1 June 2 June 2 June 10 June 14 June 15 June 16 June 17 June 18 June 23 June 28 June 28 June 28 June 29 June 30 June 30 June 30 Miller invested $50,000 cash, $10,000 inventory (workbooks, manuals, and textbooks), and office furniture worth $10,000 to the company in exchange for 5,000 shares of common stock. The common stock has a par value of $1. The firm paid $10,000 for leasehold improvements. The firm purchased $800 of office supplies for cash. The firm paid $3,600 cash for the premium on a 12-month life insurance policy. Coverage begins on June 1st. The firm rented office space by paying $1,500 cash for the first months ( June) rent. The firm paid $1,000 cash for two weeks salaries earned by employees. The bonds to investors to raise more capital. $10,000 par value sold at a price of 94. The firm performed consulting services on account with terms 1/10, n/30 for $8,000. The firm sold manuals and workbooks for cash amounting to $6,000. The cost of the inventory was $2,000. The firm bought $250 of professional publications on account. The firm performed accounting services of $6,000 on account with terms 1/10, net 30. The firm paid $1,000 cash for two weeks salaries earned by employees. A customer paid $5,000 in advance as a retainer for future accounting work. The firm paid commission reps who sell the textbooks $250 cash. The firm paid $200 cash for repairs to the computers used by employees. The firm paid $300 cash for Junes telephone bill and $550 cash for the electric bill. The firm paid $ 1,000 cash for dividends. At month-end, the firm estimates its bad debts as 2% of the months credit sales. Miller uses the allowance method of accounting for bad debt. This is an adjusting entry.

The companys chart of accounts follows: 101 Cash 105 Accounts Receivable 106 Allowance for Bad Debt 120 Supplies 125 Prepaid Insurance 140 Inventory 150 Office Furniture 155 Equipment 158 Accumulated Depreciation 200 Accounts Payable 205 Unearned Revenue 209 Salaries Payable 211 Payroll Taxes Payable 212 Interest Payable 215 Notes Payable 216 Discount on Notes Payable 305 Common Stock 306 Paid-In Capital in Excess of Par 310 Retained Earnings 312 Dividends REQUIRED 405 Revenue 605 Cost of Goods Sold 607 Depreciation Expense 608 Salaries Expense 610 Insurance Expense 611 Rent Expense 620 Repair Expense 625 Telephone Expense 630 Utilities Expense 635 Dues and Subscriptions 640 Office Supplies Expense 650 Payroll Tax Expense 720 Subcontract Expense 740 Bad Debt Expense 800 Interest Expense 900 Income Summary

REQUIRED: 1. Use the balance column format to set up each ledger account listed in its chart of accounts. 2. Prepare journal entries to record the transactions for June and post them to the ledger accounts. The company records prepaid and unearned items in balance sheet accounts. 3. Prepare an unadjusted trial balance as of June 30th. 4. Use the following information to journalize and post adjusting entries for the month: a. One months insurance coverage has expired. b. At the end of the month, $200 of office supplies are still available. c. The months depreciation on the office furniture and leasehold improvements is $250. d. Employees earned $200 of unpaid and unrecorded salaries at month end. e. The firm earned $500 of revenue paid on retainer by the customer at month-end. f. The firm accrued $650 in unpaid and unrecorded payroll taxes. g. A physical count on the inventory (books, manuals, etc.) showed $8,000 remaining at June 30th. h. Interest accrued but not paid on the Note Payable at June 30 was $100. The amount amortized on the Discount is $40. 5. Prepare an income statement and the statement of retained earnings for the month of June and balance sheet at June 30, 2017. 6. Prepare journal entries to close the temporary accounts and post these entries to the ledger. 7. Prepare a post-closing trial balance.

20 ACCT 1100 Miller & Associates, Inc. Jun 1 The firm invested assets for common stock. $ 70,000 1 Paid for leasehold improvements 10,000

Additional Information: 1/12 of life insurance expired at month-end ? Office supplies on hand at month-end 200 Depreciation on the furniture and leasehold improvements 250 Salaries accrued and not paid at month-end 200 Accounting services performed on retainer at month-end 500 Payroll taxes accrued and not paid at month-end 650 Interest accrued but not paid June 30 was $100. Amount amortized on discount at June 30 was $30 140 A physical count of books, manuals, etc. as inventory remaining at June 30 8000 Check figures: Adjusted trial balance totals 106,730 Net income 6,130 Total assets 90,270 Post-closing trial balance totals 91,360 2 Purchased office supplies 800 3 Paid insurance premium 3,600 10 Paid office rent 1,500 14 Paid salaries 1,000 15 Sold bonds at a discount 9,400 16 Performed consulting services 8,000 17 Sold inventory 6,000 17 Cost of sale of inventory 2,000 18 Purchased professional publications 250 23 Performed consulting services 6,000 28 Paid salaries 1,000 28 Customer paid retainer 5,000 28 Paid commissioned reps 250 29 Paid for repairs 200 30 Paid telephone and electric bills 850 30 Paid cash dividends 1,000 30 Provision for bad debt using income statement approach (adjusting entry) 280 Chart of Accounts 101 Cash 635 Dues and Subscriptions 105 Accounts Receivable 640 Office supplies expense 106 Allowance for Bad Debt 650 Payroll tax expense 120 Supplies 720 Commission expense 125 Prepaid insurance 740 Bad debt expense 140 Inventory 800 Interest expense 150 Office Furniture 900 Income Summary 155 Leasehold improvements 158 Accumulated depreciation 200 Accounts payable 205 Unearned revenue 209 Salaries payable 211 Payroll tax payable 212 Interest Payable 215 Notes payable 216 Discount of Notes Payable 305 Common stock 306 Paid-In Capital in Excess of Par 310 Retained Earnings 312 Dividends 405 Revenue 605 Cost of Goods Sold 607 Depreciation expense 608 Salaries expense 610 Insurance expense 611 Rent expense 620 Repair expense 625 Telephone expense 630 Utilities expense