well as merchandising operation named 1. On Sept. 1,2002, Lorin Dwight created a new self-storage business as SafeStore Co. The following transactions occurred during the company's first month: Sept I Lorin Dwight invested $1,300,000 cash and buildings worth $150,000 into the SafeStore Co 1 Paid $14400 fr the premium on a one-year insurance policy- on a one-year insurance policy. Coverage begins on September l. 1 Signed a contract for equipment rental at the rate of $2,000 per month. 5 Purchased $22.000 of office supplies, paying $18,000 cash and promising to pay the balance in future. 7 Paid an employee $1Q,000 for one week salary 10. Purchased merchandise of $300,000 on account from Procrastinator Inc.; term 5/16; n/30, FOB Shipping Point. The purchaser paid $3,000 transportation cost. Purchased merchandise of $450,000 on account from Angel and Reginae Company, term 3/s, n/30, Fo 11 The seller paid transportation cost of $12,000. Destination. Sold merchandise of $400,000 to XVz. The cost of the goods is $250,000. The term of the trade is FOB 12 Destination. Paid $10,000 transportation charge. Other terms are 4/14; EOM. 13 XYZ returned $40,000 merchandise that cost $25,000 because of defectiveness. 14 Collected the amount due from XY2 15 Sold merchandise of $350,000 to ABC. The cost of the goods is $80,000. The term of the trade is FOR Shipping Point. ABC paid $5,000 transportation charge. Other terms are 4/14; EOM 17 Returned $20,000 goods to Angel and Reginae Company because of defectiveness 18. Paid the amount due to Angel and Reginae Company. 26. Paid the amount due to Procrastinator Inc. regarding the transaction of Sept. 10 30 Collected $9,800 of storage fees from customers. 30 Paid the month's $400 telephone bill. 30 Paid $950 cash to repair a leaking roof. 30 Paid the rent due for the month. Dividend of $2,000 was paid to Lorin Dwight, the owner of the business. 30 Required: A) i. Prepare journal entries to record the transactions for September ii. Post your entries into the general ledger (you may use "T" format for your ledger accounts) ii Prepare an unadjusted trial balance as of September 30, using the balances in your general ledger adjusting entries to update the B) The following additional information is available to enable you to prepare a accounts in the unadjusted trial balance that you prepared in item (A)(i) above. iii) above Additional Information for adjusting entries: a. One month's insurance coverage has expired. b. There is $1,500 of office supplies available at the end of the c. Depreciation on the buildings is $1,800. d. The employee earned S200 of unpaid and unrecorded salary month. e. The company earned $1,100 of storage fees that are neither already recorded nor collected from the customer. levant "T" accounts that you After completing the adjusting entries, post the adjusting entries to the re ii) prepared in requirement A(ii) above, as these are just additional information for the same company. Of course, if you need create such account. an account that is not presently existing, you realize that you are supposed to i) Prepare an adjusted trial balance as of September 30, 2002 on the basis of the new balances in your iv) Prepare income statement. v) Prepare retained earnings statement, assuming there is no beginning retained earnings balance. general ledger. Prepare the Balance sheet at September 30, 2002. Prepare journal entries to close appropriate accounts. vi) vii) vii) Prepare post-closing trial balance
