Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

please can you solve the journal and adjusting entry ? On Dec 31, 2021, the end of its most recent fiscal year, Very Big Corp.

please can you solve the journal and adjusting entry ? image text in transcribed
image text in transcribed
On Dec 31, 2021, the end of its most recent fiscal year, Very Big Corp. Of America's post-closing trial balance was as follows: The company underwent a major expansion in Jan. New staff was hired and more financing was obtained. Very Big Corp. Of America conducted the following transactions during lan 2022, and adjusts its accounts monthly. Jan 01 Purchased equipment, paying $5,240 cash and signing a 2-year note payable for $19,960. The equipment has a 4-year useful life. The note has a 6% interest rate, with interest payable on the first day of each following month. Jan 02 Issued 21,000 shares of common stock for $52,500cash. Jan 03 Paid $3,900 cash for a 12 -month insurance policy effective Jan 01 . Jan 10 Collected $1,350 cash on account from Aleherpax. This client was billed in December when Very Big Corp. Of America performed the service. Jan 14 Paid $1,550 cash for a utility bill. This was related to December utilities that were accrued at the end of December. Jan 20 Performed services worth 523,200 on account and billed customers. Adjustment data: 1. Adjustment of prepaid insurance. 2. Equipment depreciation, 5545 per month. 3. Accrual of interest on note payable. 4. Estimated utilities expense for January, 11,950 (invoice will be received next month). 5. Income tax for January, 54,350 will be paid next month. The chart of accounts for Very Big Corp. Of America contains the following accounts: Cash, Accounts Receivable, Supplies, Prepaid Insurance, Prepaid Rent, Equipment, Accumulated DepreciationEquipment, Accounts Payable, Notes Payable, Interest Payable, Income Taxes Payable, Salaries and Wages Payable, Unearned Service Revenue, Common Stock, Retained Earnings, Income Summary, Service Revenue, Supplies Expense, Depreciation Expense, Insurance Expense, Salaries and Wages Expense, Advertising Expense, Income Tax Expense, Interest Expense, Rent Expense, and Utilities Expense. - Instructions a. Journalize the January transactions (including adjusting entries). b. Enter the opening balances in the ledger accounts (Use T-accounts). c. Post to the ledger accounts. d. Prepare a trial balance at Jan 31,2022 . e. Journalize and post adjusting entries for the month ending Jan 31, 2022. f. Prepare an adjusted trial balance. g. Prepare an income statement and a retained earnings statement for January and a balance sheet at Jan 31,2022 . (Net income $15,931, Total assets $125,090 )

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

Selected Materials From Managerial Accounting

Authors: Ray H. Garrison

12th Edition

0077331559, 978-0077331559

More Books

Students also viewed these Accounting questions

Question

Consider the system described in exercise

Answered: 1 week ago