Question

Assignment Details

Final Project Overview

Throughout this course, you have learned various components of accounting. These components work hand-in-hand to create the accounting cycle – the process of recording, summarizing and reporting transactions. The final project will provide you the opportunity to apply the skills covered in this course through the completion of the accounting cycle. In addition, you will be able to demonstrate your understanding through analysis of the completed information. This project will be completed in two parts in Units 3 and 5.

Final Project Data

On December 1, 2015 John Trap created a new travel agency, Trap Adventures, Inc. providing exclusive adventure trips. The following transactions occurred during December 2015.

(NOTE: There are no beginning balances – this is a new company.)

Dec 1	John Trap invested $60,000 cash in the company for common stock.
2	Purchase office equipment for $17,500 cash.
2	The company rented furnished office space by paying $18,000 cash for the first six months (December 2015 - May 2016) rent.
3	The company purchased $1,500 of office supplies on account.
10	The company paid $3,600 cash for the premium on a 12-month insurance policy.
14	The company paid $10,750 cash for two weeks' salaries earned by employees.
24	The company collected $54,000 cash on commissions from airlines on tickets obtained for customers.
28	The company paid $12,125 cash for two weeks' salaries earned by employees.
29	The company paid $350 cash for minor repairs to the company's computer.
30	The company paid $450 cash for this month's telephone bill.
30	Dividends of $3,000 cash were paid.

Adjustment Data:

One month's insurance coverage has expired.

The company occupied the office space for the month of December.

At the end of the month, $600 of office supplies are still available.

This month's depreciation on the computer equipment is $325.

Employees earned $525 of unpaid and unrecorded salaries as of month-end.

Final Project Requirements

Using the spreadsheet found here and information above, complete the following:

Journal entries to record the transactions that occurred during the month of December.

Prepare an unadjusted trial balance.

Answer 1

Date	Account Titles and Explanation	Debit	Credit
Dec. 1	Cash	60000
	Common stock		60000
	(To record common stock issued for cash)
2	Office equipment	17500
	Cash		17500
	(To record purchase of office equipment)
2	Prepaid rent	18000
	Cash		18000
	(To record rent paid for six months)
3	Office supplies	1500
	Accounts payable		1500
	(To record office supplies purchased on account)
10	Prepaid insurance	3600
	Cash		3600
	(To record insurance paid for 12 months)
14	Salaries expense	10750
	Cash		10750
	(To record salaries paid)
24	Cash	54000
	Commissions revenue		54000
	(To record commission revenue collected)
28	Salaries expense	12125
	Cash		12125
	(To record salaries paid)
29	Repairs expense	350
	Cash		350
	(To record cash paid for repairs)
30	Telephone expense	450
	Cash		450
	(To record telephone expense paid)
30	Dividends	3000
	Cash		3000
	(To record dividends paid)

Trap Adventures, Inc.
Unadjusted Trial Balance
December 31, 2015
Account	Debit	Credit
Cash	48225
Office supplies	1500
Prepaid rent	18000
Prepaid insurance	3600
Office equipment	17500
Accounts payable		1500
Common stock		60000
Dividends	3000
Commissions revenue		54000
Salaries expense	22875
Repairs expense	350
Telephone expense	450
Totals $	115500	115500