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Project 1 : Your Service Company You have decided to start a service company. You will bill you customers based on an hourly rate. you

Project 1: Your Service Company
You have decided to start a service company. You will bill you customers based on an hourly rate. you charge $175 per hour)?
Since this is the first month of operations, you will start with a Retained Earnings balance of $0. The project file shows your chart of accounts but you will need to classify them by account type and financial statement.
The following transactions occurred during the month of September (use accounts listed on your chart):
Sept 1 You contributed $150,000 cash to your business and you are the only stockholder.
Sept 5 Received a bank loan of $75,000 payable in 5 years.
Sept 6 Purchased and paid $42,500 for a car to use in the business.
Sept 7 Signed a lease on a building and prepaid 12-months rent for $36,000.
Sept 10 Purchased a one-year insurance policy for the next year for $15,600.
Sept 12 Purchased office supplies for $2,500 to setup the office. You will pay for these in 30 days.
Sept 15 Performed work for customers. You completed 70 hours of work and received payment immediately. Hint: For amount, multiply 40 hours x amount you charge per hour.
Sept 20 Received utility bill for this month for $275 payable on October 15.
Sept 22 Performed work for customers. You completed 125 hours of work and will receive payment within the next 30 days. Hint: For amount, multiply hours x amount you charge per hour.
Sept 25 Paid your employee for work performed salary of $3,500.
Sept 27 Paid the utility bill received on Sept 20.
Sept 28 Received payment from customers for $17,450
Sept 29 Paid Dividends of $1,500
Part 1:
1. Prepare journal entries for each of these transactions.
2. Post the transactions using the ledger cards (use proper EXCEL formula for balance column).
3. Prepare an Unadjusted Trial Balance (use proper EXCEL cell referencing and formulas for debit and credit columns).
4. You have decided to complete adjusting journal entries at the end of each month. Using the information below, prepare the adjusting journal entries:
a) Supplies on hand are $650.
b) One month of insurance has expired or been used.
c) One month of depreciation on the car is $625.
d) One month of rent has been used or passed.
e) Accrued interest for one month on the bank loan is $500. This will be paid quarterly (hint: you are recording the September amount only).
5. Post the adjusting entries using the same ledger cards.
6. Prepare the Adjusted Trial Balance.

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