Question

Part 1: Record the following transactions for Classic Canine Cuts for the month of December in the General Journal.

Transaction Date Description
1 12/1 Issued 100,000 shares of common stock for $100,000.
2 12/2
A retail space is rented. Paid for one year of rent in advance totaling $24,000. (rent is $2,000 per month)
3 12/4 Purchased equipment for the business totaling $36,000.
4 12/5 Purchased $1,500 of supplies on account.
5 12/7 Provided services to customers for cash totaling $5,000.
6 12/9
Purchased an ad in the local newspaper to run during December for $400.
7 12/12
Customers purchased $1,000 of gift certificates for services to be provided in the future (pre-paid for future services).
8 12/15
Paid employee salaries for the first half of December totaling $1,200.
9 12/17 Paid $1,000 for the supplies that were purchased on December 5th.
10 12/20 Provided $2,500 of services to customers on account.
11 12/25 Paid a cash dividend of $800 to the shareholders.
12 12/30 Received $1,500 on account for services provided on 12/20.



Part 2: Post all of the transactions for the month of December from the General Journal to the General Ledger.


Part 3: Complete a Trial Balance as of December 31, 2019.




Page 3

Part 4: Record the adjusting entries for Classic Canine Cuts for the month of December in the General Journal.

Transaction Date Description
Adj. 1 12/31
One month of rent that was prepaid has been used for the month of December.
Adj. 2 12/31
The equipment purchased for $36,000 has a useful life of 5 years and no salvage value. (Monthly depreciation is $600.)
Adj. 3 12/31 At the end of December, $1,000 of supplies remain on hand.
Adj. 4 12/31
By the end of December $700 worth of the gift certificates had been redeemed by customers (revenue earned) for grooming services and had not been recorded.
Adj. 5 12/31
Salaries for the second half of December are $1,400, but they will not be paid until January 3rd.



Part 5: Post all of the adjusting entries for the month of December from the General Journal to the General Ledger.


Part 6: Complete an Adjusted Trial Balance as of December 31, 2019.

* Remember a balance in an account on the trial balance will carry over to the adjusted trial balance if it was not changed by an adjusting journal entry.*


Part 7: Complete an Income Statement for the month ended December 31, 2019.


Part 8: Complete a Statement of Retained Earnings for the month ended December 31, 2019.


Part 9: Prepare a Balance Sheet as of December 31, 2019.

Part 10. Record the closing entries for the year ending December 31, 2019.

Part 11. Post all of the year end closing entries from the General Journal to the General Ledger.

Part 12. Prepare a Post-Closing Trial Balance.


Page 4

General Journal Part 1

Ref # Date Account Debit Credit
1
  
  
2
  
  
3
  
  
4
  
  
5
  
  
6
  
  
7
  
  
8
  
  
9
  
  

  
Page 5

General Journal Part 1 (Continued)

Ref # Date Account Debit Credit
10
  
  
11
  
  
12
  
  


General Journal – Adjusting Entries Part 4

Ref # Date Account Debit Credit
A 1
  
  
A 2
  
  
A 3
  
  
A. 4
  
  
A. 5
  
  


Page 6

General Ledger Parts 2,5,11 TB = Trial Balance Total ATB = Adjusted Trial Balance Total CB= Closing Balance Total Post Journal references in left column for debits and right column for credits in each account. Assets

Ref # Cash Ref # Debit Credit TB



Ref # #
Accounts Receivable Ref # Debit Credit TB



Ref # Supplies Ref # Debit Credit TB ATB

Ref # Prepaid Rent Ref # Debit Credit TB ATB




Ref # Equipment Ref # Debit Credit TB




Ref # Accumulated Depreciation Ref # Debit Credit ATB





Page 7

Liabilities



Ref # Accounts Payable Ref # Debit Credit TB
















Ref # Salaries Payable Ref # Debit Credit ATB




Ref # Unearned (Deferred) Revenue Ref # Debit Credit TB ATB



  
Page 8

Stockholders’ Equity



Ref # Common Stock Ref # Debit Credit TB












Ref # Dividends Ref # Debit Credit TB CB



Ref # Retained Earnings Ref # Debit Credit CB





































Page 9

Revenue

Ref # Service Revenue Ref # Debit Credit TB ATB CB

Expenses

Ref # Advertising Expense Ref # Debit Credit TB CB
  
Page 10


Ref # Salaries Expense Ref # Debit Credit TB ATB CB

Ref # Depreciation Expense Ref # Debit Credit ATB CB



Ref # Rent Expense Ref # Debit Credit ATB CB



Ref # Supplies Expense Ref # Debit Credit ATB CB






  
Page 11

Part 3

Classic Canine Cuts Trial Balance December 31, 2019
Account Debit Credit
$ $












Total $ $   
Page 12

Part 6

Classic Canine Cuts Adjusted Trial Balance December 31, 2019
Account Debit Credit
$ $

















Total $ $


Page 13

Part 7

Classic Canine Cuts Income Statement For the Month Ended December 31, 2019
Revenue   
  
$
Expenses   
$




Total Expenses
$
Net Income
$


Part 8

Classic Canine Cuts Statement of Retained Earning December 31, 2019
Retained Earnings
Beginning Balance, December 1, 2019 $
  
Ending Balance, December 31, 2019
$



Page 14

Part 9

Classic Canine Cuts Balance Sheet December 31, 2019
Assets
  
Liabilities
  


Total Current Liabilities

Total Current Assets



Property Plant and Equipment   
Total Liabilities


Stockholders’ Equity
  
Total Property Plant and Equipment


Total Stockholders’ Equity

Total Assets

Total Liabilities and Stockholders’ Equity

  
Page 15




General Journal – Closing Entries Part 10 Revenue, Expense and Dividend accounts.

Ref # Date Account Debit Credit
C.1
  
  
C.2
  
  
  
  
  
  
C.3
  
  

  
Page 16


Part 12

Classic Canine Cuts Post-Closing Trial Balance December 31, 2019
Account Debit Credit
$ $










Total $ $

Answer 1

Part 1. Recording the transactions in the General Journal.
Date	Account Title	Dr.	Cr.
Dec. 1	Cash	$100,000
	Common Stock		$100,000
Dec. 2	Prepaid Rent	$24,000
	Cash		$24,000
Dec. 4	Equipment	$36,000
	Cash		$36,000
Dec. 5	Supplies	$1,500
	Account Payable		$1,500
Dec. 7	Cash	$5,000
	Service Revenue		$5,000
Dec. 9	Advertisement Expense	$400
	Cash		$400
Dec.1 2	Cash	$1,000
	Unearned Revenue		$1,000
Dec. 15	Salaries Expense	$1,200
	Cash		$1,200
Dec. 17	Account Payable	$1,000
	Cash		$1,000
Dec. 20	Account Receivable	$2,500
	Service Revenue		$2,500
Dec. 25	Dividend	$800
	Cash		$800
Dec. 30	Cash	$1,500
	Account Receivable		$1,500
Adjusting Entries
Dec. 31	Rent Expense	$    2,000
	Prepaid Rent		$     2,000
Dec. 31	Depreciation Expense	$       600
	Accumulated Depreciation		$        600
Dec. 31	Supplies Expense	$       500
	Supplies		$        500
Dec. 31	Unearned Revenue	$       700
	Service Revenue		$        700
Dec. 31	Salaries Expense	$    1,400
	Salaries Payable		$     1,400

Part 2: General Journal and Posting Adjusting Entry
Common Stock
Date	Account Title	Dr.	Cr.
Dec. 1	Cash		$   100,000
Dec. 31	End. Bal.		$100,000
Cash
Dec. 1	Common Stock	$ 100,000
Dec. 2	Prepaid Rent		$     24,000
Dec. 4	Equipment		$     36,000
Dec. 7	Service Revenue	$      5,000
Dec. 9	Advertising Expense		$          400
Dec. 12	Unearned Revenue	$      1,000
Dec. 15	Salaries Expense		$       1,200
Dec. 17	Account Payable		$       1,000
Dec. 25	Dividend		$          800
Dec. 30	Account Receivable	$      1,500
Dec. 31	End. Bal.	$ 44,100
Prepaid Rent
Dec. 2	Cash	$    24,000
Dec. 31	Rent Expense		$       2,000
Dec. 31	End. Bal.	$ 22,000
Rent Expense
Dec. 31	Prepaid Rent	$      2,000
Dec. 31	End. Bal.	$    2,000
Equipment
Dec. 4	Cash	$    36,000
Dec. 31	End. Bal.	$ 36,000
Supplies
Dec. 5	Account Payable	$      1,500
Dec. 31	Supplies Expense		$          500
Dec. 31	End. Bal.	$    1,000
Account Payable
Dec. 5	Supplies		$       1,500
Dec. 17	Cash	$      1,000
Dec. 31	End. Bal.		$        500
Service Revenue
Dec. 7	Cash		$       5,000
Dec. 20	Account Receivable		$       2,500
Dec. 31	Unearned Revenue		$          700
Dec. 31	End. Bal.		$8,200
Advertisement Expense
Dec. 9	Cash	$         400
Dec. 31	End. Bal.	$       400
Unearned Revenue
Dec. 12	Cash		$       1,000
Dec. 31	Service Revenue	$         700
Dec. 31	End. Bal.		$        300
Salaries Expense
Dec. 15	Cash	$      1,200
	Salaries Payable	$      1,400
Dec. 31	End. Bal.	$    2,600
Account Receivable
Dec. 20	Service Revenue	$      2,500
Dec. 30	Cash		$       1,500
Dec. 31	End. Bal.	$    1,000
Dividend
Dec. 25	Cash	$         800
Dec. 31	End. Bal.	$       800
Salaries Payable
Dec.31	Salaries Expense		1400
Dec.31	End. Bal.		1400
Depreciation Expense
Dec. 31	Acc. Depreciation	600
Dec. 31	End. Bal.	600
Accumulated Depreciation
Dec. 31	Depreciation Expense		600
Dec. 31	End. Bal.		600
Supplies Expense
Dec. 31	Supplies	500
Dec. 31	End. Bal.	500

Requirement: 6 to 9:
Account	Unadjusted Trial Balance		Adjustment		Adjusted Trial Balance		Income Statement		Balance Sheet & S.O.E
	DR.	CR.	DR.	CR.	DR.	CR.	DR.	CR.	DR.	CR.
Cash	44100				44100				44100
Equipment	36000				36000				36000
Acc. Depreciation				600		600			-600
Supplies	1500			500	1000				1000
Prepaid Rent	24000			2000	22000				22000
A.R	1000				1000				1000
Common Stock		100000				100000				100000
Unearned Revenue		1000	700			300				300
A. Payable		500				500				500
Service Revenue		7500		700		8200		8200
Salaries Payable				1400		1400				1400
Salaries Expense	1200		1400		2600		2600
Advertisement Expense	400				400		400
Rent Expense			2000		2000		2000
Depreciation Expense			600		600		600
Supplies Expense			500		500		500
Net Income, R. Earning							2100			2100
Dividend	800				800					-800
Total	109000	109000	5200	5200	111000	111000	8200	8200	103500	103500

Closing Entries
Dec.31	Service Revenue	8200
	Income Summaries		8200
	Income Summaries	6100
	Salaries Expense		2600
	Advt. Expense		400
	Rent Exp.		2000
	Dep. Exp.		600
	Supplies Exp.		500
	Income Summaries	2100
	Ret. Earning		2100
	Retained Earning	800
	Dividend		800
12: Post Closing Trial Bal.
		Dr.	Cr.
	Cash	44100
	Equipment	36000
	Acc. Depreciation	-600
	Supplies	1000
	Prepaid Rent	22000
	AR	1000
	Unearned Rev.		300
	AP		500
	Salaries Payable		1400
	Com. Stock		100000