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On January 1, 2021, the general ledger of Dynamite Fireworks includes the following account balances: Accounts...

On January 1, 2021, the general ledger of Dynamite Fireworks includes the following account balances:

Accounts Debit Credit
Cash $ 24,900
Accounts Receivable 6,300
Supplies 4,200
Land 61,000
Accounts Payable $ 4,300
Common Stock 76,000
Retained Earnings 16,100
Totals $ 96,400 $ 96,400

During January 2021, the following transactions occur:

January 2 Purchase rental space for one year in advance, $9,300 ($775/month).
January 9 Purchase additional supplies on account, $4,600.
January 13 Provide services to customers on account, $26,600.
January 17 Receive cash in advance from customers for services to be provided in the future, $4,800.
January 20 Pay cash for salaries, $12,600.
January 22 Receive cash on accounts receivable, $25,200.
January 29 Pay cash on accounts payable, $5,100.

The following information is available on January 31.

  • Rent for the month of January has expired.
  • Supplies remaining at the end of January total $3,900.
  • By the end of January, $4,025 of services has been provided to customers who paid in advance on January 17.
  • Unpaid salaries at the end of January are $5,030.

Record the purchase of rental space for one year in advance, $9,300 ($775/month).

Record the purchase of additional supplies on account, $4,600.

Record the providing of services to customers on account, $26,600.

Record the receipt of cash in advance from customers for services to be provided in the future, $4,800.

Record the payment of cash for salaries, $12,600.

Record the receipt of cash on accounts receivable, $25,200.

Record the payment of cash on accounts payable, $5,100.

Record the adjusting entry for rent. Rent for the month of January has expired.

Record the adjusting entry for supplies. Supplies remaining at the end of January total $3,900.

Record the adjusting entry for services provided to customers who paid in advance. By the end of January, $4,025 of services has been provided to customers who paid in advance on January 17.

Record the adjusting entry for salaries payable. Unpaid salaries at the end of January are $5,030.

Record the entry to close the revenue accounts.

Record the entry to close the expense accounts.

Solutions

Expert Solution

Account Titles Debit Credit
Jan. 2 Prepaid Rent $             9,300
       Cash $             9,300
Jan. 9 Supplies $             4,600
      Accounts Payable $             4,600
Jan. 13 Accounts Receivable $           26,600
      Service Revenue $           26,600
Jan. 17 Cash $             4,800
      Unearned Revenue $             4,800
Jan. 20 Salaries Expense $           12,600
      Cash $           12,600
Jan. 22 Cash $           25,200
       Accounts Receivable $           25,200
Jan. 29 Accounts Payable $             5,100
      Cash $             5,100
Jan. 31 a Rent Expense $                 775
      Prepaid Rent $                 775
Jan. 31 b Supplies Expense $             4,900
       Supplies $             4,900
Jan. 31 c Unearned Revenue $             4,025
      Service Revenue $             4,025
Jan. 31 d Salaries Expense $             5,030
       Salaries Payable $             5,030
Jan . 31 Service Revenue $           30,625
       Retained Earnings $           30,625
Jan. 31 Retained Earnings $           23,305
       Salaries Expense $           17,630
       Rent Expense $                 775
       Supplies Expense $             4,900

ekkarill92 answered 1 year ago
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