Prepare Closing and Adjusting Entries for the following Transactions: During June, Greg organized his new business called Shred- It Boards, Inc. and completed the following transactions:

March 14- Incorporated the business and invested $55,000 of cash by opening a business checking account. The cash invested was received by the business issuing common stock.

March 18- Purchased office equipment including computers, printers, furniture, filing cabinets, etc, for $12,720 cash. All office equipment is estimated to have a four year useful life with no salvage value. The equipment will begin use on April 1, and will be depreciated monthly using the straight-line method

. March 21- Purchased a one year insurance policy for $500 per month. Greg paid cash and the policy will take effect on April 1. March 28- Signed a lease and pre-paid one year's rent on a building for $2,000 a month. The lease's term begins on April 1. March 30- Borrowed $27,000 by issuing a note payable to the bank. The note requires 8% simple interest to be paid monthly, with prinicipal to be repaid in two years. Proceeds from the loan were deposited in the business checking account.

First Month Operations

April 4- Greg purchased a special wholesale sales license from the state. This should be recorded as a selling expense. He paid $400 cash.

April 15- Greg received a salary of $1,000 in cash. Since production has yet to occur, you determined that the salary was to be recorded as an administrative expense.

April 20- Greg purchased manufacturing equipment such as saws, sanders, and shapers for 19,800 cash. The equipment has a six year useful life and no salvage value. Use of the equipment will begin on May 1, and equipment will be depreciated monthly, beginning in May, using the straight-line method.

April 29- Greg paid one month's interest on the note payable

April 29- Greg paid the utility bill of $300 for the electricity used during the month of April. Again, since no production has yet to occur you determined that this utilities cost was to be recorded as an administrative expense. Adjusting Entries

April 30- At the end of April you determined that the following adjusting entries were necessary with all expenses recorded as administrative expenses: One month of prepaid insurance had expired Office equipment had depreciated for one month One month of prepaid rent had been consumed.