Question

Thomas Topology has completed all its journal entries and adjusting entries for the month of April 2018. The chart of accounts and adjusted trial balance are shown below.

Account Description	Account #
ASSETS
Cash	101
A/R	105
Prepaid Insurance	110
Equipment	120
Accumulated Depreciation-Equipment	125
LIABILITIES
A/P	200
Unearned Revenue	210
Notes Payable	215
OWNERS EQUITY
Thompson,Capital	300
Thompson,Withdrawals	310
Income Summary	315
REVENUE
Service Revenue	400
EXPENSES
Depreciation Expense	510
Insurance Expense	515
Interest Expense	520
Rent Expense	540
Salaries Expense	545
Telephone Expense	550
Travel Expense	555

Adjusted Trial Balance
Account Title	DR	CR
Cash	32,050
A/R	9000
Prepaid Insurance	1100
Equipment	15000
Accumulated Depreciation-Equipment		120
Accounts Payable		25550
Unearned Revenue		3200
Notes Payable		1500
Thompson,Capital		18000
Service Revenue		26300
Depreciation Expense	120
Insurance Expense	100
Interest Expense	50
Rent Expense	1000
Salaries Expense	8000
Telephone Expense	250
Travel Expense	8000
Total	74670	74670

A.Prepare the Income Statement for Thomas Topolgy

B. Prepare the Statement of owners equity

C.Prepare the balance sheet

D.Create the closing entries using the income summary account and post the closing entries to the ledger accounts

E. Prepare the post closing trial balance. Note: The daily transactions and adjustments for the month of April have already been posted in the general ledger. You are only responsible for posting the closing entries.

Answer 1

A.

Thomas Topology
Income Statement
For the Month Ended April 30, 2018
Revenue:
Service revenue		26300
Expenses:
Depreciation expense	120
Insurance expense	100
Interest expense	50
Rent expense	1000
Salaries expense	8000
Telephone expense	250
Travel expense	8000
Total expense		17520
Net income $		8780

B.

Thomas Topology
Statement of Owner's Equity
For the Month Ended April 30, 2018
Thomson, Capital, beginning balance	18000
Add: Net income	8780
Thomson, Capital, ending balance	26780

C.

Thomas Topology
Balance Sheet
April 30, 2018
Assets
Cash		32050
Accounts receivable		9000
Prepaid insurance		1100
Equipment	15000
Less: Accumulated depreciation	-120	14880
Total assets		57030
Liabilities and Owner's Equity
Accounts payable		25550
Unearned revenue		3200
Notes payable		1500
Total liabilities		30250
Thomson, capital		26780
Total liabilities and owner's equity		57030

D.

Date	Account Titles and Explanation	Debit	Credit
Apr. 30	Service revenue	26300
	Income Summary		26300
	(To close revenue account)
Apr. 30	Income Summary	17520
	Depreciation expense		120
	Insurance expense		100
	Interest expense		50
	Rent expense		1000
	Salaries expense		8000
	Telephone expense		250
	Travel expense		8000
	(To close expense accounts)
Apr. 30	Income Summary ($26300 - $17520)	8780
	Thomson, capital		8780
	(To close Income Summary)

E.

Thomas Topology
Post-Closing Trial Balance
April 30, 2018
Account Title	Debit	Credit
Cash	32050
Accounts receivable	9000
Prepaid insurance	1100
Equipment	15000
Accumulated depreciation-equipment		120
Accounts payable		25550
Unearned revenue		3200
Notes payable		1500
Thomson, capital		26780
Total $	57150	57150