Question

Invested start up $10,000

Purchased Equipment on account 10,000

Paid Rent 1,000

Performed Services on account 20,000

Cash receips 15,000

Cash disburement 8,000

Paid Wage 8,000

Fed income tax withheld 15% of gross

Fica tax witheld 10% of gross

Prepare a trial balance for 12-31-17 on spreadsheet

Answer 1

• All working forms part of the answer
• Working for ending balances based on the data made available by you:

---Note: Wages = $ 8,000

FICA = 10% = 800 x 10% = $ 800
Fed Income tax = 8000 x 15% = $ 1,200

Net Cash paid = 8000 – 800 – 1200 = $ 6,000

Transaction	Cash	Equipment	Accounts receivables	Accounts payable	Owner's Equity-Capital (Common Stock)	Rent Expense	Wages Expenses	Federal Income Tax payable	FICA payable	Service Revenue
Invested Startup	$                         10,000.00				$         10,000.00
Equipment purchased on account		$                                       10,000.00		$         10,000.00
Rent Paid	$                         (1,000.00)					$        1,000.00
Performed Services on Account			$         20,000.00							$    20,000.00
Cash receipts	$                         15,000.00		$      (15,000.00)
Cash disbursements	$                         (8,000.00)			$         (8,000.00)
Wages paid *See Note above	$                         (6,000.00)						$            8,000.00	$        1,200.00	$         800.00
Ending Balance for Trial Balance	$                         10,000.00	$                                       10,000.00	$           5,000.00	$           2,000.00	$          10,000.00	$        1,000.00	$            8,000.00	$        1,200.00	$          800.00	$    20,000.00

• Trial Balance for 12-31-2017, as asked:

Accounts title	Debit	Credit
Cash	$                                       10,000.00
Equipment	$                                       10,000.00
Accounts receivables	$                                         5,000.00
Accounts payable		$           2,000.00
Federal Income Tax payable		$           1,200.00
FICA payable		$               800.00
Owner's Equity-Capital (Common Stock)		$         10,000.00
Rent Expense	$                                         1,000.00
Wages Expenses	$                                         8,000.00
Service Revenue		$         20,000.00
TOTAL	$                                       34,000.00	$         34,000.00