On September 1, 2020, Mr Harbord formed a corporation called Free Diving. The new corporation was able to begin operations immediately.

The corporation performs adjusting entries monthly. Closing entries are performed each quarter.

During September, the corporation entered into the following transactions:

September 1, Issued to Mr Harbord 4,000 shares of capital stock amounting $50 each in exchange of cash.

September 1, Purchase a building $50,000 and paid by issuing a one-year note payable

September 2, Purchase furniture for $12,000 in cash

September 3, Received a bill from Universal Utilities for the month of September amounting $500. Payment is due in 45 days.

September 4, Purchase for $26,000 a land in cash

September 5, Paid $6,000 to Pan Ocean as four months advance rent for a boat.

September 14, Sequoia Co. paid $9,000 cash for a transport to be performed in emergency the same day.

September 15 Declared a dividend of $1,200 payable on September 30^th

September 24, Purchase office supplies for $1,250 and paid $725 in cash and the rest on account

September 25, Factor Tree corp paid $22,000 cash for transports of wood to be performed in the coming weeks.

September 26, Performed a transportation of goods for Ying Co. Sales invoice show an amount of $9,000 due in 30 days.

September 26, paid 4 weeks salaries for $20,000

September 27 Paid the account payable created on September 24,.

Data for Adjusting Entries

The advance payment of rent on September 5 covered a period of 4 months.

A physical count revealed $400 of office supplies on hand at the end of the month

One month interest on the note payable is $250

The furniture is being depreciated by straight line method over a period of 5 years and the residual value is $1,500

Unrecorded and uncollected earned Revenue amounted $900.

Free Diving has earned $9,000 of the revenues that had been collected in advance

Free Diving pays $5,000 for a five days work week (Monday to Friday), September 30 is a Tuesday.

The building has a residual value of $5,000 and an estimated useful life of 20 years. Use straight line method.

Instructions

1/ Perform the following steps of the accounting cycle for the month of September:

Journalize the September transactions. Do not record adjusting entries at this point.

Post the September transactions to the appropriate ledger accounts.

Prepare the unadjusted trial balance columns of a 10-column worksheet for the period ended September 30.

Prepare the necessary adjusting entries for September.

Post the September adjusting entries to the appropriate ledger accounts.

Complete the 10-column worksheet for the period ended September 30.

2/ Prepare an income statement and statement of retained earnings for the period ended September 30, and a balance sheet as of September 30.

3/ Prepare closing entries and post to ledger accounts.

4/ Prepare an after-closing trial balance as of September 30