PART A

Alamein opened Alamein Cleaning Services (ACS) on July 1, 2017. During July, the following transactions took place:

July 1 Alamein invested $20,000 in the business.

July 1 ACS purchased a used truck for $12,000, paying $4,000 cash, with the balance on account. The truck is expected to be used for 5 years and after which it will disposed off for $2,000.

July 3 ACS purchased cleaning supplies for $2,100 on account.

July 5 ACS paid $1,800 cash on 1-year insurance policy effective July 1^st.

July 12 ACS billed customers $4,500 for cleaning services.

July 18 ACS paid $1,500 cash on amount owed on truck and $1,400 on amount owed on cleaning supplies.

July 20 ACS paid $2,800 cash for employee salaries.

July 21 ACS collected $3,400 cash from customers billed on July 12.

July 25 ACS billed customers $6,000 for cleaning services.

July 31 ACS paid $350 for the monthly gasoline bill for the truck.

July 31 ACS withdrew $5,600 cash for personal use.

Required

1. Prepare journal entries for the above transactions.

2. Post the journal entries into the ledger.

3. Extract a trial balance as at July 31^st 2017.

PART B

ACS discovered the following data on July 31^st after preparing the trial balance in Part A above:

1. Unbilled and uncollected revenue for services performed at July 31^st were $2,700.

2. No provision has been made for depreciation.

3. No adjustment for insurance has been made.

4. Only $600 of cleaning supplies are on hand.

5. Employee salaries of $1,000 have not been paid.

Required:

1. Prepare journal entries for the above adjustments and post them to the ledger.

2. Prepare a worksheet and make the above adjustments in the worksheet.

3. Prepare the following financial statements:

a. The income statement for the period ended July 31^st 2017.

b. Statement of changes in owners equity for the period ended July 31^st 2017.

c. Statement of cash flows for the period ended July 31^st 2017.

d. Statement of financial position as at July 31^st 2017.