S & B Accounting Services and Office Supplies

Trial Balance

January 1, 2021

Title	Debit	Credit
Cash	9,000
Accounts Receivable	2,240
Merchandise Inventory	1,800*
Supplies	560
Equipment	25,000
Accumulated Depreciation		1,500
Accounts Payable		3,900
Unearned Service Revenue		4,000
Salaries and Wages Payable		1,700
Common Stock		20,000
Retained Earnings		7,500
Totals	$38,600	$38,600

*(3,000 units at $0.60)

This is a simulated problem showing some summary transactions that occurred during the month of January.

Jan 4 Paid Januarys rent $350.

5 Purchased 4,000 units of inventory from dds Discount Supply on account at $0.72 each. Terms 2/10, n/30.

6 Sold 4,400 units of inventory for cash at $0.90 per unit. (Sold 3,000 of the 0.60 units and 1,400 of the $0.72 units)

8 Paid $3,550 for salaries due employees, of which 1,850 is for January and $1,700 is for December 2020.

11 Gave a January 6^th customer $180 for 200 units returned costing $144. (These units were returned to inventory)

11 Received $2,000 cash from customers in payment on account. (December salesno discounts)

12 Paid $3,000 on account. (No discounts)

14 Paid dds Discount Supply in full, less discount. (Round to whole dollars)

15 Purchased 5,000 units of inventory on account Office Headquarters at $0.80 each. Terms 2/10, n/30.

18 Sold 4,000 units of inventory to customers on account at $0.95 per unit. Terms 2/10, n/30. (Sold 2,800 of the 0.72 units and 1,200 of the 0.80 units)

20 Received $4,300 Cash for services performed in January.

22 Paid Salaries $3,550.

25 Received collections in full, less discount, from customers billed for sales on January 18th.

27 Purchased supplies on account $1,500.

29 Returned $300 of the wrong cleaner purchased on January 27^th.

29 Paid Office Headquarters in full. (No discount)

29 Performed services on account and billed customers $700.

29 Received $750 from customers for services to be performed in the future.

Adjustment Data:

1. Supplies on hand are valued at $860.
2. Accrued salaries are $1,750.
3. Depreciation for the month is $250.
4. $550 of services related to the Unearned Service Revenue has not been earned by month end.

Instructions:

1. Enter the January 1, balances in ledger accounts.
2. Journalize the January transactions.
3. Post the January entries to the ledger accounts. HINT: You will need to add/delete some accounts to/from the beginning ones available.
4. Prepare a Preadjusting Trial Balance as of January 31, 2021.
5. Journalize the Adjusting Entries.
6. Post the Adjusting Entries.
7. Prepare an Adjusted Trial Balance at January 31, 2021.
8. Journalize the Closing Entries