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4. Prepare an unadjusted trial balance as of July 31, 2019. PS Music UNADJUSTED TRIAL BALANCE...

4. Prepare an unadjusted trial balance as of July 31, 2019.

PS Music

UNADJUSTED TRIAL BALANCE

July 31, 2019

ACCOUNT TITLE DEBIT CREDIT

1

Cash

2

Accounts Receivable

3

Supplies

4

Prepaid Insurance

5

Office Equipment

6

Accounts Payable

7

Unearned Revenue

8

Peyton Smith, Capital

9

Peyton Smith, Drawing

10

Fees Earned

11

Wages Expense

12

Office Rent Expense

13

Equipment Rent Expense

14

Utilities Expense

15

Music Expense

16

Advertising Expense

17

Supplies Expense

18

Miscellaneous Expense

19

Totals

The transactions completed by PS Music during June 2019 were described at the end of Chapter 1. The following transactions were completed during July, the second month of the business’s operations:

Jul. 1 Peyton Smith made an additional investment in PS Music by depositing $5,000 in PS Music’s checking account.
1 Instead of continuing to share office space with a local real estate agency, Peyton decided to rent office space near a local music store. Paid rent for July, $1,750.
1 Paid a premium of $2,700 for a comprehensive insurance policy covering liability, theft, and fire. The policy covers a one-year period.
2 Received $1,000 cash from customers on account.
3 On behalf of PS Music, Peyton signed a contract with a local radio station, KXMD, to provide guest spots for the next three months. The contract requires PS Music to provide a guest disc jockey for 80 hours per month for a monthly fee of $3,600. Any additional hours beyond 80 will be billed to KXMD at $40 per hour. In accordance with the contract, Peyton received $7,200 from KXMD as an advance payment for the first two months.
3 Paid $250 to creditors on account.
4 Paid an attorney $900 for reviewing the July 3 contract with KXMD. (Record as Miscellaneous Expense.)
5 Purchased office equipment on account from Office Mart, $7,500.
8 Paid for a newspaper advertisement, $200.
11 Received $1,000 for serving as a disc jockey for a party.
13 Paid $700 to a local audio electronics store for rental of digital recording equipment.
14 Paid wages of $1,200 to receptionist and part-time assistant.

Enter the following transactions on Page 2 of the two-column journal:

Jul. 16 Received $2,000 for serving as a disc jockey for a wedding reception.
18 Purchased supplies on account, $850.
21 Paid $620 to Upload Music for use of its current music demos in making various music sets.
22 Paid $800 to a local radio station to advertise the services of PS Music twice daily for the remainder of July.
23 Served as disc jockey for a party for $2,500. Received $750, with the remainder due August 4, 2019.
27 Paid electric bill, $915.
28 Paid wages of $1,200 to receptionist and part-time assistant.
29 Paid miscellaneous expenses, $540.
30 Served as a disc jockey for a charity ball for $1,500. Received $500, with the remainder due on August 9, 2019.
31 Received $3,000 for serving as a disc jockey for a party.
31 Paid $1,400 royalties (music expense) to National Music Clearing for use of various artists’ music during July.
31 Withdrew $1,250 cash from PS Music for personal use.

PS Music’s chart of accounts and the balance of accounts as of July 1, 2019 (all normal balances), are as follows:

11 Cash $3,920
12 Accounts Receivable 1,000
14 Supplies 170
15 Prepaid Insurance
17 Office Equipment
21 Accounts Payable 250
23 Unearned Revenue
31 Peyton Smith, Capital 4,000
32 Peyton Smith, Drawing 500
41 Fees Earned 6,200
50 Wages Expense 400
51 Office Rent Expense 800
52 Equipment Rent Expense 675
53 Utilities Expense 300
54 Music Expense 1,590
55 Advertising Expense 500
56 Supplies Expense 180
59 Miscellaneous Expense 415
Required:
1. Use the data in Accounting Equation Grid panel (reproduced from Chapter 1 Continuing Problem) and enter the July 1, 2019, account balances in the appropriate balance column of a four-column account. Write Balance in the Item column, and select a check mark in the Posting Reference column. (Hint: Verify the equality of the debit  and credit balances in the ledger before proceeding with the next instruction.)
2. Analyze and journalize each transaction in a two-column journal beginning on Page 1, omitting journal entry explanations. Refer to the Chart of Accounts for exact wording of account titles.
3. Post the journal to the ledger, extending the account balance to the appropriate balance column after each posting. Indicate a zero balance by inserting a 0 (zero) in either of the Balance columns opposite the entry.
4.

Prepare an unadjusted trial balance as of July 31, 2019.

CHART OF ACCOUNTS
PS Music
General Ledger
ASSETS
11 Cash
12 Accounts Receivable
14 Supplies
15 Prepaid Insurance
17 Office Equipment
LIABILITIES
21 Accounts Payable
23 Unearned Revenue
EQUITY
31 Peyton Smith, Capital
32 Peyton Smith, Drawing
REVENUE
41 Fees Earned
EXPENSES
50 Wages Expense
51 Office Rent Expense
52 Equipment Rent Expense
53 Utilities Expense
54 Music Expense
55 Advertising Expense
56 Supplies Expense
59

Miscellaneous Expense

Solutions

Expert Solution

Cash A/c
Jul-01 Cash 5000 To Balance B/d 3920 By Rent 1750
To Smith Capital 5000 To Smith Capital 5000 By Insurance 2700
To Accounts Receivable 1000 By Accounts Payable 250
Jul-01 Rent Expense 1750 To Unearned Revenue 7200 By Miscellaneous Expense 900
To Cash 1750 To Income 1000 By Advertising 200
To Income 2000 By Equipment Rent Expense 700 Unadjusted Trial balance As on 31-july-2019
Jul-01 Insurance Premium 2700 To Income 2500 By Wages 1200 Cash 13945
To Cash 2700 To Unearned Revenue 750 By Music Expense 620 Supplies 1020
To Income 1500 By Advertising 800 Accounts Payable 8350
Jul-02 Cash 1000 To Unearned Revenue 500 By Electricity 915 Smith Capital 9000
To Accounts Receivable 1000 To Income 3000 By Wages 1200 Smith Drawings 1750
By Miscellaneous Expense 540 Unearned Revenue 8450
Jul-03 Cash 7200 By Music Expense 1400 Office Equipment 7500
To Unearned Revenue 7200 By Drawings 1250 Office Rent 1750
By Balance B/d 13945 Insurance Premium 2700
28370 28370 Miscellaneous Expense 1440
Jul-03 Accounts Payable 250 Accounts Receivable Advertising Expense 200
To cash 250 To Balance B/d 1000 By Cash 1000 Equipment Rent Expense 700
1000 1000 Wages 2400
Jul-04 Miscellaneous Expense 900 Music Expense 2020
To Cash 900 Supplies Advertising Expense 800
To Balance B/d 170 By Balance B/d 1020 Electricity 915
Jul-05 Office Equipment 7500 To Accounts Payable 850 Fees Earned 10000
To Office Mart 7500 1020 1020 Retained Earnings(Note) 1340
TOTAL 37140 37140
Jul-08 Advertising Expense 200
To Cash 200 Accounts Payable Note Retained Earnings A/c As on July-01 2019
To cash 250 By Balance B/d 250 Wages Expense 400 Fees Earned 6200
Jul-11 Cash 1000 By office Equipment 7500 Office Rent 800
To Income 1000 To Balance C/d 8350 By Supplies 850 Equipment Rent Expense 675
8600 8600 Utilities Expense 300
Jul-13 Equipment Rent Expense 700 Music Expense 1590
To Cash 700 Smith Capital Advertising Expense 500
To Balance C/d 9000 By Balance B/d 4000 Supplies Expense 180
Jul-14 Wages 1200 By Cash 5000 Miscellaneous Expense 415
To Cash 1200 9000 9000 Profit 1340
6200 6200
Jul-16 Cash 2000 Smith Drawings
To Income 2000 To Balance B/d 500 By Balance C/d 1750
To Cash 1250
Jul-18 Supplies 850 1750 1750
To Accounts Payable 850
Jul-21 Music Expense 620
To Cash 620 Unearned Revenue
To Balance C/d 8450 By Cash 7200
Jul-22 Advertising Expense 800 By Cash 750
To Cash 800 By Cash 500
8450 8450
Jul-23 Cash 2500
To Income 2500 Office Equipment
To Office Mart 7500 By Balance C/d 7500
Jul-23 Cash `750 7500 7500
To Unearned Revenue 750
Jul-27 Electricity Expense 915
To Cash 915
Jul-28 Wages 1200
To Cash 1200
Jul-29 Miscellaneous Expense 540
To Cash 540
Jul-30 Cash 1500
To Income 1500
Jul-30 Cash 500
To Unearned Revenue 500
Jul-31 Cash 3000
To Income 3000
Jul-31 Music Expense(Royalty) 1400
To cash 1400
Jul-31 Drawings 1250
To Cash 1250

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