TRANSACTIONS

January 2 Pedro Hernandez invested $10,000 to start an advertising agency

January 2 Rented an office, paying two months' rent in advance, $800

January 3 Ordered art supplies, $1,800, and office supplies, $800

January 4 Purchased art equipment for $4,200 cash

January 5 Purchased office equipment from Baskwell Equipment for $3,000, paying $1,500 in cash and agreeing to pay the rest next month

January 6 Purchased on credit are supplies for $1,800 and office supplies for $800 from Robinson Supply Company

January 8 Paid $480 for a one-year insurance policy with coverage effective January 1

January 9 Paid Robinson Supply Company $1,000 of the amount owed

January 10 Performed a service by placing advertisements for automobile dealer in the newspaper and collected a fee of $1,400

January 12 Paid the secretary two weeks' wages, $600 (Friday)

January 15 Accepted $1,000 as an advance fee for are work to be done for another agency

January 19 Performed a service by placing several major advertisements for Macy's Department Stores. The fee of $2,800 is billed now but will be collected next month.

January 25 Pedro Hernandez withdrew $1,400 from the business for personal use.

January 26 Paid the secretary two more weeks' wages, $600 (Friday)

January 29 Received and paid the utility bill of $100

January 30 Received (but did not pay) a telephone bill, $70

January 31 One-half of prepaid rent had expired

January 31 One-twelfth of prepaid insurance has expired

January 31 Art supplies costing $1,300 is still on hand

January 31 Office supplies costing $600 is still on hand

January 31 Art equipment has a useful life of 5 years; calculate depreciation (1 month)

January 31 Office equipment has a useful life of 5 years; calculate depreciation (1 month)

January 31 $400 of the art work was completed and accepted by the other agency

January 31 Agreed to place advertisements for Diego Tire Co. on January 31 for $200

January 31 The secretary worked the last 3 days of January; record the accrued wages

INSTRUCTIONS

1. Record all transactions in the General Journal
2. Post all transactions to the General Ledger
3. Complete a 10-Column Worksheet

Prepare a Trial Balance

Record the adjusting entries

Prepare an adjusted Trial Balance

Calculate the Income Statement Columns

Calculate the Balance Sheet Columns

4. Prepare the financial statements

Prepare an Income Statement

Prepare the Statement of Owners Equity

Prepare a Balance Sheet