Question

The following is the post-closing trial balance for the Whitlow Manufacturing Corporation as of December 31, 2020.

Account Title	Debits			Credits
Cash		5,800
Accounts receivable		2,800
Inventory		5,800
Equipment		11,800
Accumulated depreciation					4,300
Accounts payable					3,800
Accrued liabilities					0
Common stock					10,000
Retained earnings					8,100
Sales revenue					0
Cost of goods sold		0
Salaries expense		0
Rent expense		0
Advertising expense		0
Totals		26,200			26,200

The following transactions occurred during January 2021:

Jan.		1		Sold merchandise for cash, $4,300. The cost of the merchandise was $2,800. The company uses the perpetual inventory system.
		2		Purchased equipment on account for $6,300 from the Strong Company.
		4		Received a $100 invoice from the local newspaper requesting payment for an advertisement that Whitlow placed in the paper on January 2.
		8		Sold merchandise on account for $5,800. The cost of the merchandise was $3,600.
		10		Purchased merchandise on account for $9,900.
		13		Purchased equipment for cash, $700.
		16		Paid the entire amount due to the Strong Company.
		18		Received $5,600 from customers on account.
		20		Paid $700 to the owner of the building for January’s rent.
		30		Paid employees $3,800 for salaries for the month of January.
		31		Paid a cash dividend of $1,000 to shareholders.

1. & 3. Enter the beginning balances as of January 1, 2021 and post the entries to T-accounts.

4. Prepare an unadjusted trial balance as of January 31, 2021.

Answer 1

Preparing General Journal to record the Transactions occurred during January 2021:-

Whitlow Manufacturing Corporation

General Journal

For the Month of January

Date	Accounts Title	Debit	Credit
January 1	Cash	$4,300
	Sales Revenue		$4,300
	Cost of Goods Sold	$2,800
	Inventory		$2,800
2	Equipment	$6,300
	Accounts Payable		$6,300
4	Advertising Expense	$100
	Accrued Liabilities		$100
8	Accounts Receivable	$5,800
	Sales Revenue		$5,800
	Cost of Goods Sold	$3,600
	Inventory		$3,600
10	Inventory	$9,900
	Accounts Payable		$9,900
13	Equipment	$700
	Cash		$700
16	Accounts Payable	$6,300
	Cash		$6,300
18	Cash	$5,600
	Accounts Receivable		$5,600
20	Rent Expense	$700
	Cash		$700
30	Salaries Expense	$3,800
	Cash		$3,800
31	Dividends	$1,000
	Cash		$1,000

Posting the beginning balances and entries to T-ACCOUNTS:-

Cash

Date	Debit	Credit	Balance
January 1	$5,800		$5,800
1	$4,300		$10,100
13		$700	$9,400
16		6,300	$3,100
18	5,600		$8,700
20		700	$8,000
30		3,800	$4,200
31		1,000	$3,200

Accounts Receivable

January 1	$2,800		$2,800
8	5,800		$8,600
18		$5,600	$3,000

Inventory

January 1	$5,800		$5,800
1		$2,800	$3,000
8		3,600	($600)
10	$9,900		$9,300

Equipment

January 1	$11,800		$11,800
2	$6,300		$18,100
13	700		$18,800

Accumulated Depreciation

January 1		$4,300	$4,300

Accounts Payable

January 1		$3,800	$3,800
2		$6,300	$10,100
10		$9,900	$20,000
16	$6,300		$13,700

Accrued Liabilities

January 1		$0	$0
4		$100	$100

Common Stock

January 1		$10,000	$10,000

Retained Earnings

January 1		$8,100	$8,100

Dividends

January 1	$0		$0
31	$1,000		$1,000

Sales Revenue

January 1		$0	$0
1		4,300	$4,300
8		5,800	$10,100

Cost of Goods Sold

January 1	$0		$0
1	2,800		$2,800
8	3,600		$6,400

Salaries Expense

January 1	$0		$0
30	$3,800		$3,800

Rent Expense

January 1	$0		$0
20	$700		$700

Advertising Expense

January 1	$0		$0
4	100		$100

Preparing Unadjusted Trial Balance:-

Whitlow Manufacturing Corporation

Unadjusted Trial Balance

January 31,2021

Accounts	Debit	Credit
Cash	$3,200
Accounts Receivable	3,000
Inventory	9,300
Equipment	18,800
Accumulated Depreciation		$4,300
Accounts Payable		13,700
Accrued Liabilities		100
Common Stock		10,000
Retained Earnings		8,100
Dividends	1,000
Sales Revenue		10,100
Cost of Goods Sold	6,400
Salaries Expense	3,800
Rent Expense	700
Advertising Expense	100
Totals	$46,300	$46,300