In: Accounting
Assignment 1 Recording Process Emily Valley is a licensed dentist. During the first month of the operation of her business, the following events and transactions occurred. April 1- Invested $20,000 cash in her business. 1 Hired a secretary-receptionist at a salary of $700 per week payable monthly. 2 Paid office rent for the month $1,100. 3 Purchased dental supplies on account from Dazzle Company $4,000. 10 Performed dental services and billed insurance companies $5,100. 11 Received $1,000 cash advance from Leah Mataruka for an implant. 20 Received $2,100 cash for services performed from Michael Santos. 30 Paid secretary-receptionist for the month $2,800. 30 Paid $2,400 to Dazzle for accounts payable due. Emily uses the following chart of accounts: No. 101 Cash, No. 112 Accounts Receivable, No. 126 Supplies, No. 201 Accounts Payable, No. 209 Unearned Service Revenue, No. 301 Owner’s Capital, No. 400 Service Revenue, No. 726 Salaries and Wages Expense, and No. 729 Rent Expense. Instructions (a) Journalize the transactions. (b) Post to the ledger accounts. (c) Prepare a trial balance on April 30, 2014.
ANSWER
Part a)
The journal entries are prepared as below:
Date | Account Titles | Ref. | Debit | Credit |
Apr 01 | Cash | 101 | $20,000 | |
Owner's Capital | 301 | $20,000 | ||
Apr 01 | No Entry Needed | |||
Apr 02 | Rent Expense | 729 | $1,100 | |
Cash | 101 | $1,100 | ||
Apr 03 | Supplies | 126 | $4,000 | |
Accounts Payable | 201 | $4,000 | ||
Apr 10 | Accounts Receivable | 112 | $5,100 | |
Service Revenue | 400 | $5,100 | ||
Apr 11 | Cash | 101 | $1,000 | |
Unearned Service Revenue | 209 | $1,000 | ||
Apr 20 | Cash | 101 | $2,100 | |
Service Revenue | 400 | $2,100 | ||
Apr 30 | Salaries and Wages Expense | 726 | $2,800 | |
Cash | 101 | $2,800 | ||
Apr 30 | Accounts Payable | 201 | $2,400 | |
Cash | 101 | $2,400 |
_____
Part b)
The ledger accounts are provided as follows:
Cash (No. 101) | |||||
Date | Explanation | Ref. | Debit | Credit | Balance |
Apr 01 | J1 | 20,000 | 20,000 | ||
Apr 02 | J1 | 1,100 | 18,900 | ||
Apr 11 | J1 | 1,000 | 19,900 | ||
Apr 20 | J1 | 2,100 | 22,000 | ||
Apr 30 | J1 | 2,800 | 19,200 | ||
Apr 30 | J1 | 2,400 | 16,800 |
_____
Accounts Receivable (No. 112) | |||||
Date | Explanation | Ref. | Debit | Credit | Balance |
Apr 10 | J1 | 5,100 | 5,100 |
_____
Supplies (No. 126) | |||||
Date | Explanation | Ref. | Debit | Credit | Balance |
Apr 03 | J1 | 4,000 | 4,000 |
_____
Accounts Payable (No. 201) | |||||
Date | Explanation | Ref. | Debit | Credit | Balance |
Apr 03 | J1 | 4,000 | 4,000 | ||
Apr 30 | J1 | 2,400 | 1,600 |
_____
Unearned Service Revenue (No. 209) | |||||
Date | Explanation | Ref. | Debit | Credit | Balance |
Apr 11 | J1 | 1,000 | 1,000 |
_____
Onwer's Capital (No. 301) | |||||
Date | Explanation | Ref. | Debit | Credit | Balance |
Apr 01 | J1 | 20,000 | 20,000 |
_____
Service Revenue (No. 400) | |||||
Date | Explanation | Ref. | Debit | Credit | Balance |
Apr 10 | J1 | 5,100 | 5,100 | ||
Apr 20 | J1 | 2,100 | 7,200 |
_____
Salaries and Wages Expense (No. 726) | |||||
Date | Explanation | Ref. | Debit | Credit | Balance |
Apr 30 | J1 | 2,800 | 2,800 |
_____
Rent Expense (No. 729) | |||||
Date | Explanation | Ref. | Debit | Credit | Balance |
Apr 02 | 1,100 | 1,100 |
_____
Part c)
The trial balance as on April 30, 2014 is given as below:
Emily's Business | |||
Trial Balance | |||
April 30, 2017 | |||
Account Titles | Ref. | Debit | Credit |
Cash | 101 | 16,800 | |
Accounts Receivable | 112 | 5,100 | |
Supplies | 126 | 4,000 | |
Accounts Payable | 201 | 1,600 | |
Unearned Service Revenue | 209 | 1,000 | |
Owner's Capital | 301 | 20,000 | |
Service Revenue | 400 | 7,200 | |
Salaries and Wages Expense | 726 | 2,800 | |
Rent Expense | 729 | 1,100 | |
Total | $29,800 | $29,800 |
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