Question

Comprehensive Problem 1
Part 1:

The following is a comprehensive problem which encompasses all of the elements learned in previous chapters. You can refer to the objectives for each chapter covered as a review of the concepts.

Kelly Pitney began her consulting business, Kelly Consulting, on April 1, 20Y8. The chart of accounts for Kelly Consulting is shown below:

11	Cash	32	Retained Earnings
12	Accounts Receivable	33	Dividends
14	Supplies	41	Fees Earned
15	Prepaid Rent	51	Salary Expense
16	Prepaid Insurance	52	Rent Expense
18	Office Equipment	53	Supplies Expense
19	Accumulated Depreciation	54	Depreciation Expense
21	Accounts Payable	55	Insurance Expense
22	Salaries Payable	59	Miscellaneous Expense
23	Unearned Fees
31	Common Stock

The post-closing trial balance as of April 30, 20Y8, is shown below:

Kelly Consulting Post-Closing Trial Balance April 30, 20Y8
	Account No.	Debit	Credit
Cash	11	22,100
Accounts Receivable	12	3,400
Supplies	14	1,350
Prepaid Rent	15	3,200
Prepaid Insurance	16	1,500
Office Equipment	18	14,500
Accumulated Depreciation	19		330
Accounts Payable	21		800
Salaries Payable	22		120
Unearned Fees	23		2,500
Common Stock	31		30,000
Retained Earnings	32		12,300
		46,050	46,050

1. May 3: Received cash from clients as an advance payment for services to be provided and recorded it as unearned fees, $4,500.

2. May 5: Received cash from clients on account, $2,450.

3. May 9: Paid cash for a newspaper advertisement, $225.

4. May 13: Paid Office Station Co. for part of the debt incurred on April 5, $640.

5. May 15: Recorded services provided on account for the period May 1–15, $9,180.

6. May 16: Paid part-time receptionist for two weeks' salary including the amount owed on April 30, $750.

7. May 17: Recorded cash from cash clients for fees earned during the period May 1–16, $8,360.

8. May 20: Purchased supplies on account, $735.

9. May 21: Recorded services provided on account for the period May 16–20, $4,820.

10. May 25: Recorded cash from cash clients for fees earned for the period May 17–23, $7,900.

11. May 27: Received cash from clients on account, $9,520.

12. May 28: Paid part-time receptionist for two weeks' salary, $750.

13. May 30: Paid telephone bill for May, $260.

14. May 31: Paid electricity bill for May, $810.

15. May 31: Recorded cash from cash clients for fees earned for the period May 26–31, $3,300.

16. May 31: Recorded services provided on account for the remainder of May, $2,650.

17. May 31: Paid dividends, $10,500.

18. Part 2: Using the attached spreadsheet, post the journal entries from part 1 to a ledger of four-column accounts.

    Part 3: Prepare an unadjusted trial balance. If an amount box does not require an entry, leave it blank.

    Kelly Consulting Unadjusted Trial Balance May 31, 20Y8
    Account Title	Debit Balances	Credit Balances

Answer 1

Journal Entries
Date	Particulars	Dr	Cr
May-03	Cash	4500
	To Unearned Fees		4500
May-05	Cash	2450
	To Account Receivable		2450
May-09	Advertising Expense	225
	To Cash		225
May-13	Accounts Payable	640
	To Cash		640
May-15	Accounts Receivable	9180
	To Fees for services		9180
May-16	Salaries payable	120
	Salaries	630
	To Cash		750
May-17	Cash	8360
	To Accounts Receivable		8360
May-20	Supplies	735
	To Accounts Payable		735
May-21	Accounts Receivable	4820
	To Fees for services		4820

Ledger Accounts affected by Journal Entries and entries posted in Ledger Accounts:

Cash
Date	Particulars	Amount	Date	Particulars	Amount
Apr-30	Balance b/d	22100	May-09	By Advertisement	225
May-03	To Unearned Revenue	4500	May-13	By Accounts Payable	640
May-05	To Account Receivable	2450	May-16	By Salaries Payable	120
May-17	By Cash	8360		By Salaries	630
				Balance c/d	35795
	Total	37410		Total	37410
Accounts Receivable
Date	Particulars	Amount	Date	Particulars	Amount
Apr-30	Balance B/d	3400	May-05	By Cash	2450
May-15	To fees for services	9180	May-17	By Cash	8360
May-21	To fees for services	8420
				Balance c/d	10190
	Total	21000		Total	21000
Advertisement
Date	Particulars	Amount	Date	Particulars	Amount
May-09	To Cash	225
				Balance c/d	225
	Total	225		Total	225
Salary
Date	Particulars	Amount	Date	Particulars	Amount
Apr-30	Balance B/d
	To Cash	630	May-31	Balance c/d	630
	Total	630		Total	630
Supplies
Date	Particulars	Amount	Date	Particulars	Amount
Apr-30	Balance B/d	1350
May-20	To Accounts payable	735
			May-31	Balance c/d	2085
	Total	2085		Total	2085
Unearned Fees
Date	Particulars	Amount	Date	Particulars	Amount
			Apr-30	By Balance B/d	2500
				By Cash	4500
May-31	To Balance c/d	7000
	Total	7000		Total	7000
Accounts Payable
Date	Particulars	Amount	Date	Particulars	Amount
May-13	To Cash	640	Apr-30	By Balance c/d	800
				By Supplies	735
May-31	To Balance c/d	895
	Total	1535		Total	1535
Salary Payable
Date	Particulars	Amount	Date	Particulars	Amount
May-13	To Cash	120	Apr-30	By Balance c/d	120
May-31	To Balance c/d	0
	Total	120		Total	120
Fees For Services
Date	Particulars	Amount	Date	Particulars	Amount
			May-15	By Accounts Receivable	9180
			May-21	By Accounts Receivable	8420
May-31	To Balance c/d	17600
	Total	17600		Total	17600

ADJUSTED TRIAL BALANCE
May 31,2018
Account Title	Debit balances	Credit Balances
Cash in Hand	35795
Accounts Receivable	10190
Supplies	2085
Prepaid Rent	3200
Prepaid Insurance	1500
Office Equipment	14500
Advertisement	225
Salary	630
Accumulated Depreciation		330
Accounts Payable		895
Unearned Fees		7000
Fees for Services		17600
Common Stock		30000
Retained Earnings		12300
Totals	68125	68125

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