Question

Tom Smith opend a repair business on may 1 2017, called Smith Repairs. During the first month of opertaions the firm had the following transactions.

May 1 invested 20,000 in cash in the business
May 2 paid rent for 900
May 5 Purchased office suppiles with cash 300
May 8 Bought equipment for 8,000 on accountant
may 12 performed services for 5,000 in Cash
may 19 paid electric bill 250
may 20 paid 1200 for a one year insurance policy
may 21 paid employees 750 for the month
may 30 Smith Withdrew 500 for personal use

Record these transactions of the General Jorunal
Post Transactions to the General ledger
Compelete the worksheet using the following information for adjustments
a.One month of insurance has expired
b. After a count of supplies it was determited that only 100 of supplies remained
c. Wages earned but unpaid amounted to 200
d. Depercation on the equipment was 50
4.Prepare income stament
5. Prepare a stament of Owners equity
6. Prepare A Balance Sheet
7. Jornalize and post adjusting entries
8. Jornalize and post closing entries
9. Preapare a Post closing trial balance

Answer 1

	Tom Smith
	General Journal
Date	Journal	Amount (DR)	Amount (CR)
01-May	Cash	$                       20,000.00
	To Smith's Capital		$                               20,000.00
	(Being amount invested in business)
02-May	Rent	$                             900.00
	To Cash		$                                     900.00
	(Being amount of Rent Paid)
05-May	Office Supplies	$                             300.00
	To Cash		$                                     300.00
	(Being amount of Office supplies purchased)
08-May	Equipment	$                         8,000.00
	To Account Payable		$                                 8,000.00
	(Being amount of Equipment Purchased)
12-May	Cash	$                         5,000.00
	To Service Revenue		$                                 5,000.00
	(Being amount of Service Revenue)
19-May	Electricity Expenses	$                             250.00
	To Cash		$                                     250.00
	(Being amount of electicity expenses paid)
20-May	Prepaid Insurance	$                         1,200.00
	To Cash		$                                 1,200.00
	(Being amount paid for one year insurance)
21-May	Wages	$                             750.00
	To Cash		$                                     750.00
	(Being amount paid for salaries expenses)
30-May	Smith's Drawings	$                             500.00
	To Cash		$                                     500.00
	(Being amount of Smith withdraw for personal use)
	Adjusting Entries
Date	Particular	Amount (Dr)	Amount(Cr)
31-May	Insurance=($1200/12)	$                             100.00
	To Prepaid Insurance		$                                     100.00
	(Being amount of one month insurance expired)
31-May	Supplies Expenses($300-$100)	$                             200.00
	To Supplies		$                                     200.00
	(Being amount of supplies expenses)
31-May	Wages	$                             200.00
	To Wages Payable		$                                     200.00
	(Being amount of Wages earned but unpaid)
31-May	Deoreciation	$                               50.00
	To Accumulated Depreciation		$                                       50.00
	(Being amount of Depreciation)
	Cash A/c			Balance
Date	Title	Debit	Credit	Debit	Credit
01-May	Smith's Capital	$                       20,000.00		$          20,000.00
02-May	Rent		$                                     900.00	$          19,100.00
05-May	Office Supplies		$                                     300.00	$          18,800.00
12-May	Service Revenue	$                         5,000.00		$          23,800.00
19-May	Electricity Expenses		$                                     250.00	$          23,550.00
20-May	Prepaid Insurance		$                                 1,200.00	$          22,350.00
21-May	Employees Salaries		$                                     750.00	$          21,600.00
30-May	Smith's Drawings		$                                     500.00	$          21,100.00
	Smith's Capital			Balance
Date	Title	Debit	Credit	Debit	Credit
01-May	Cash		$                               20,000.00		$ 20,000.00
	Rent
Date	Title	Debit	Credit	Debit	Credit
02-May	Cash	$                             900.00		$                900.00
	Office supplies
Date	Title	Debit	Credit	Debit	Credit
05-May	Cash	$                             300.00		$                300.00
31-May	Office Supplies Expenses		$                                     200.00	$                100.00
	Office supplies Expenses
Date	Title	Debit	Credit	Debit	Credit
31-May		$                             200.00		$                200.00
	Office Equipment
Date	Title	Debit	Credit	Debit	Credit
08-May	Accounts Payable	$                         8,000.00		$            8,000.00
	Service Revenue
Date	Title	Debit	Credit	Debit	Credit
12-May			$                                 5,000.00		$    5,000.00
				$                         -
	Electricity Expenses
Date	Title	Debit	Credit	Debit	Credit
19-May	Cash	$                             250.00		$                250.00
	Prepaid Insurance
Date	Title	Debit	Credit	Debit	Credit
20-May	Insurance	$                         1,200.00		$            1,200.00
31-May			$                                     100.00	$            1,100.00
	Insurance
Date	Title	Debit	Credit	Debit	Credit
31-May	Prepaid Insurance	$                             100.00		$                100.00
	Wages
Date	Title	Debit	Credit	Debit	Credit
21-May	Cash	$                             750.00		$                750.00
31-May	Wages Payable	$                             200.00		$                950.00
	Smith's Drawings
Date	Title	Debit	Credit	Debit	Credit
31-May	Cash	$                             500.00		$                500.00
	Wages Payable
Date	Title	Debit	Credit	Debit	Credit
31-May	Wages		$                                     750.00		$        750.00
	Depreciation
Date	Title	Debit	Credit	Debit	Credit
31-May	Accumulated Depreciation		$                                       50.00		$          50.00
	Accumulated Depreciation
Date	Title	Debit	Credit	Debit	Credit
31-May	Depreciation	$                               50.00		$                  50.00
	Tom Smith
	Adjusted Trial Balance
	Trial Balnce
	Particular	Amount (Dr)	Amount (Cr)
	Cash=	$                       21,100.00
	Office Supplies	$                             100.00
	Prepaid Insurance	$                         1,100.00
	Equipment	$                         8,000.00
	Accounts Payable		$                                 8,000.00
	Wages Payable		$                                     200.00
	Accumulated Depreciation		$                                       50.00
	Smith's Capital		$                               20,000.00
	Smith's Drawings	$                             500.00
	Service Revenue		$                                 5,000.00
	Wages Expenses	$                             950.00
	Electricity Expenses	$                             250.00
	Office Supplies expenses	$                             200.00
	Insurance	$                             100.00
	Rent Expenses	$                             900.00
	Depreciation	$                               50.00
	Total	$                       33,250.00	$                               33,250.00
	Income Statement
	September 31st
	Service Revenue		$                                 5,000.00
	Expenses
	Wages Expenses	$                             950.00
	Electricity Expenses	$                             250.00
	Office Supplies expenses	$                             200.00
	Insurance	$                             100.00
	Rent Expenses	$                             900.00
	Depreciation	$                               50.00
			$                                 2,450.00
	Net Income		$                                 2,550.00
	Balance Sheet as at November 30th,2013
	Assets
	Current Assets
	Cash	$                       21,100.00
	Office Supplies	$                             100.00
	Prepaid Insurance	$                         1,100.00
	Total Current Assets		$                               22,300.00
	Office Equipment	$                         8,000.00
	Less : Accumulted Depreciation	$                             (50.00)	$                                 7,950.00
	Total Assets		$                               30,250.00
	Liabilities
	Current Liabilities
	Accounts Payable	$                         8,000.00
	Wages Payable	$                             200.00
	Total Current liabilities		$                                 8,200.00
	Smith's Capital	$                       20,000.00
	Add: Net Income	$                         2,550.00
	Less: Drawings	$                          (500.00)	$                               22,050.00
	Total Liabilities & Stockholder's equity		$                               30,250.00