PSA3.9

Journalise transactions and follow through the accounting cycle to the preparation of nancial statements.

On 1 July 2019, the following were the account balances of Bulwara Ltd:

Debits $

Cash 5000

Accounts receivable 5600

Supplies 2000

Store equipment 20000

$ 32600

Credits $

Accumulated depreciation 1000

Accounts payable 4200

Service revenue received in advance 800

Salaries payable 1000

Share capital 20000

Retained earnings 5600

$32600

During July the following summary transactions were completed:

July

8 Paid $3000 for salaries due to employees, of which $2000 is for July and $1000 is for June.

10 Received $2000 cash from customers in payment of their accounts.

12 Received $800 cash for services performed in July 2019.

15 Purchased store equipment on account of $8000.

17 Purchased supplies on account of $3400.

24 Paid accounts payable $2000.

24 Paid July/August rent $800

25 Paid salaries $3000.

27 Performed services on account and invoiced customers for services provided $2300.

27 Received $1300 from customers for future service.

Other data:

1. Supplies on hand are valued at $3200.

2. Accrued salaries payable are $1000.

3. Depreciation for the month is $240.

4. Services have been performed in relation to $600 recorded in service revenue received in advance.

Required

(a) Make a a chart of accounts.

(b) Enter the 1 July balances in the ledger accounts (use T accounts).

(c) Journalise the July transactions.

(d) Post to the ledger accounts you prepared for part (c) above. Use service revenue, depreciation expense, supplies expense, salary expense, and rent expense.

(e) Make a trial balance at 31 July before adjusting entries.

(f) Journalise and post adjusting entries.

(g) Make an adjusted trial balance.

(h) Make a a statement of profit or loss and a calculation of retained earnings for July and Make a a statement of financial position as at 31 July 2019.