Question

In: Accounting

a. On August 1, 2020, the following were the account balances of Sheffield Repair Services. Debit...

a. On August 1, 2020, the following were the account balances of Sheffield Repair Services.

Debit Credit
Cash $6,400 Accumulated Depreciation—Equipment 640
Accounts Receivable 3,080 Accounts Payable 2,440
Notes Receivable 4,200 Unearned Service Revenue 1,340
Supplies 1,090 Salaries and Wages Payable 1,510
Equipment 10,600 Owner's Capital 19,440

25,370

25,370



During August, the following summary transactions were completed.

Aug. 1 Paid $420 cash for advertising in local newspapers. Advertising flyers will be included with newspapers delivered during August and September.
3 Paid August rent $400.
5 Received $1,270 cash from customers in payment of account.
10 Paid $3,310 for salaries due employees, of which $1,800 is for August and $1,510 is for July salaries payable.
12 Received $2,970 cash for services performed in August.
15 Purchased store equipment on account $2,120.
20 Paid creditors $2,120 of accounts payable due.
22 Purchased supplies on account $850.
25 Paid $3,070 cash for employees’ salaries.
27 Billed customers $3,990 for services performed.
29 Received $830 from customers for services to be performed in the future.

Enter the August 1 balances in the ledger accounts.

Journalize the August transactions. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.)

Post to the ledger accounts.

Prepare a trial balance at August 31.

b. Adjustment data:

1. A count shows supplies on hand of $1,020.
2. Accrued but unpaid employees’ salaries are $1,630.
3. Depreciation on equipment for the month is $340.
4. Services were performed to satisfy $850 of unearned service revenue.
5. One month’s worth of advertising services has been received.
6. One month of interest revenue related to the $4,200 note receivable has accrued. The 4-month note has a 6% annual interest rate.


Journalize and post adjusting entries. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)

\Prepare an adjusted trial balance.

Prepare an income statement for August.

Prepare an owner’s equity statement for August.

Prepare a classified balance sheet at August 31. (List Current Assets in order of liquidity.)

Journalize the closing entries. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)

Post closing entries and complete the closing process. (For accounts that have zero ending balance, the entry should be the balance date and zero for the amount. Post entries in the order of journal entries presented.)

Prepare a post-closing trial balance at August 31.

Solutions

Expert Solution

Journal & Ledger have been prepared below. Each entry has been numbered and accordingly its posting to the ledger is also numbered for tracking the effect of each entry.

JOURNAL - For transactions of August

LEDGER - Opening balances are posted for each balance given in question and entries are posted from Journal above. User may track each entry from journal entry reference number above.

Debit Amount Credit Amount
Cash
Opening balance           6,400.0
(3) To Accounts receivable           1,270.0 (1) By prepaid expense              480.0
(5) To Revenue           2,970.0 (2) By Rent              400.0
(11) To Unearned revenue              830.0 (4) By Salaries & Wages           1,800.0
(4) By Salaries & Wages payable           1,510.0
(7) By Accounts payable           2,120.0
(9) By Salaries & Wages           3,070.0
Closing balance           2,090.0
        11,470.0         11,470.0
Accounts receivable
Opening balance           3,080.0 (3) BY Cash           1,270.0
(10) By revenue           3,990.0
Closing balance           5,800.0
          7,070.0           7,070.0
Notes receivable
Opening balance           4,200.0 Closing balance           4,200.0
          4,200.0           4,200.0
Supplies
Opening balance           1,090.0
(8) To Accounts payable              850.0 Closing balance           1,940.0
          1,940.0           1,940.0
Equipment
Opening balance         10,600.0 Closing balance         12,720.0
(6) To Accounts payable           2,120.0
        12,720.0         12,720.0
Acc Depreciation
Closing balance              640.0 Opening balance              640.0
             640.0              640.0
Accounts payable
(7) To Cash           2,120.0 Opening balance           2,440.0
Closing balance           3,290.0 (6) By Equipment           2,120.0
(8) By Supplies              850.0
          5,410.0           5,410.0
Unearned service revenue
Closing balance           2,170.0 Opening balance           1,340.0
(11) By Cash              830.0
          2,170.0           2,170.0
Salaries & wages payable
(4) To Cash           1,510.0 Opening balance           1,510.0
Closing balance                   -  
          1,510.0           1,510.0
Owner's capital
Closing balance         19,440.0 Opening balance         19,440.0
        19,440.0         19,440.0
Salaries & Wages  
Opening balance                   -   Closing balance           4,870.0
(4) To Cash           1,800.0
(9) To Cash           3,070.0
          4,870.0           4,870.0
Rent
Opening balance                   -   Closing balance              400.0
(2) To Cash              400.0
             400.0              400.0
Revenue
Closing balance           6,960.0 Opening balance
(5) By Cash           2,970.0
(10) By Accounts receivable           3,990.0
                  -             6,960.0
Advertisement expense
Opening balance                   -   Closing balance                   -  
                  -                     -  
Prepaid Expense
Opening balance                   -   Closing balance              480.0
(1) To Cash              480.0
             480.0              480.0

Given below is the trial balances prepared from opening balances and balances arrived post adjustments. Balance on Aug 31 has been taken from the closing balances appearing in the ledger above.

Below is the journal and ledger postings of adjustment entries.

Journal-

Ledger - The adjustment entries have been highlighted in RED

I have answered four parts of the question. Kindly repost the question along with the provided solutionm for me or another expert to solve rest of the parts in the given time.

Providing below readily available adjusted trial balance on Aug 31


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