Problem 4-1A Applying the accounting cycle
On April 1, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the company's first month April 2 Nozomi invested $38,000 cash and computer equipment worth $30,000 in the company. April 3 The company rented furnished office space by paying $2,100 cash for the first month's (April) rent April 4 The company purchased $1.400 of office supplies for cash April 10 The company paid $2,600 cash for a 12-month insurance policy. Coverage begins on April 11. April 14 The company paid $900 cash for two weeks salaries earned by employees April 24. The company collected $11,000 cash for comissions revenue April 28 The company paid $900 cash for two weeks' salaries earned by employees April 29 The company paid 535a cash for minor repairs to computer equipment April 30 The company paid $1,000 cash for this month's telephone bill. April 30 Nozomi withdrew $1,700 cash from the company for personal use The company's chart of accounts follows: 101 cash 407 Couns Revenge 100 Accounts Receivable 612 Depreciation Expense-Oputer Equipsunt 124 Office Supplies 622 Salaries Expense 6337 120 Prepaid insurance Insurance Expense 167 Computer Equipent Rent Expense 158 Accumulated Depreciation-Computer Equipant 650 Office Supplies Event 0 Repairs 209 Salin Payable 101 Homi Capital Telephone Expens 301 Inci Check Use the following information to prepare adjusting entries: a. Prepaid insurance of $144 expired this month b. At the end of the month, $400 of office supplies are still available. C. This month's depreciation on computer equipment is $500 d. Employees earned $380 of unpaid and unrecorded salaries as of month-end. e. The company earned $2,300 of commissions revenue that is not yet recorded at month-end. Required: 1. & 2. Prepare Journal entries to record the transactions for April and post them to ledger accounts in Req 6B Gu tab. The company records prepaid and unearned items in balance sheet accounts 3. Using account balances from Requirement 6b, prepare an unadjusted trial balance as of April 30, 4. Journalize the adjusting entries for the month and then post to the ledger on Req 68 tab, using April 30 Adjusted as the date. 5a. Using adjusted account balances from Reg 6B GL tab, prepare an adjusted trial balance as of April 30. 5b. Prepare the income statement for the month of April 30 5c. Prepare the statement of owner's equity for the month of April 30 5d. Prepare the balance sheet at April 30 6a. Prepare journal entries to close the temporary accounts and then post to Rea GB GL tab. using April 30 Close as the date. 65. Post the journal entries to the ledger 7. Prepare a post-closing trial balance Complete this question by entering your answers in the tabs below. 1 Nozomi invested $38,000 cash and computer equipment worth $30,000 in the company. 2 The company rented furnished office space by paying $2,100 cash for the first month's (April) rent. 3 The company purchased $1,400 of office supplies for cash. 4 The company paid $2,600 cash for a 12-month insurance policy. Coverage begins on April 11. 5 The company paid $900 cash for two weeks' salaries earned by employees. Note: journal entry has been entered Record entry Clear entry ---- 6 The company collected $11,000 cash for commissions revenue. bo 7 The company paid $900 cash for two weeks' salaries earned by employees. 8 The company paid $350 cash for minor repairs to computer equipment. 9 The company paid $1,000 cash for this month's telephone bill. 10 Nozomi withdrew $1,700 cash from the company for personal use. Note : = journal entry has been entered Record entry Clear entry View ADVENTURE TRAVEL Unadjusted Trial Balance April 30 Account Title Debit Credit 101: Cash 106: Accounts receivable 124: Office supplies 128. Prepaid insurance 167: Computer equipment 168 Accumulated depreciation-Computer equipment 209: Salaries payable 301.3. Nozomi, Capital 302 3. Nozomi, Withdrawals 403: Commissions revenue 612: Depreciation expense--Computer equipment 622 Salaries expense 637 Insurance expense 640 Rent expense 650: Office supplies expense 684 Repaits expense 688 Telephone expense Total $ 05 x 1 Record the required adjusting entry, if any. Prepaid insurance of $144 expired this month. 2 Record the required adjusting entry, if any. At the end of the month, $400 of office supplies are still available. expired 3. Record the required adjusting entry, if any. This month's depreciation on computer equipment is $500. Credit 4. Record the required adjusting entry, if any. Employees earned $380 of unpaid and unrecorded salaries as of month-end. 5 Record the required adjusting entry, if any. The company earned $2,300 of commissions revenue that is not yet recorded at month-end. Note: = journal entry has been entered Record entry Clear entry Debit Credit ped Loc + ADVENTURE TRAVEL Adjusted Trial Balance April 30 Account Title 101: Cash 106: Accounts receivable 124: Office supplies 128. Prepaid insurance 167: Computer equipment 168 Accumulated depreciation Computer equipment 209. Salaries payable 301 3 Nozomi Capital 3023 Nozom Withdrawals 403 commissions revenue 612 Depreciation expense Computer equipment 622 salaries expense 637. Insurance expense 640 Rent expose 650 Office Supplies expense GB Repairs expense 688 Telephone expense Total w 0$ 0 Lrie ADVENTURE TRAVEL Income Statement For Month Ended April 30 Revenues Expenses: + Total expenses 0 $
