Question

Beginning account balances for 2019

Cash 150.000 , Land 20,000 , supplies 50,000 , unearned revenue 100,000 , common stock , 100,000 , retaines earnings 20,000

The following are the general journal information of Maxwell Company for 2019.

Maxwell Company General Journal, 2019
Event	Account Titles	Debit	Credit
1.	Cash	30,000
	Bank Loan		30,000
2.	Office Equipment	15,000
	Cash		15,000
3	Account Receivable	35,000
	Service Revenue		35,000
4.	Cash	15,000
	Account Receivable		15,000
5.	Dividends	5,000
	Cash		5,000
6.	Prepaid Rent	12,000
	Cash		12,000
7.	Unearned Revenue	50,000
	Service Revenue		50,000
8.	Rent Expense	6,000
	Prepaid Rent		6,000
9.	Supplies Expense	10,000
	Supplies		10,000

Required: [ 13 Marks]

1. Prepare T- Account [5 Marks]                                                                                    
2. Prepare Trial Balance [3 Marks]
3. Prepare Income Statement [2 Marks]
4. Prepare Balance Sheet [3 Marks]

Answer 1

1.

Cash A/c

To bal	150,000	By office equipment	15,000
To bank loan	30,000	By dividends	5,000
To accounts receivable	15,000	By prepaid rent	12,000
		By bal (b/f)	163,000

Land A/c

To bal

20,000

By bal

20,000

Supplies A/c

To bal	50,000	By supplies expense	10,000
		By bal	40,000

Unearned revenue A/c

		By bal	100,000
To service revenue	50,000
To bal	50,000

Common stock

		By bal	100,000
To bal	100,000

Retained earnings A/c

		By bal	20,000
To bal	20,000

Bank loan A/c

		By cash	30,000
To bal	30,000

Office equipment A/c

To cash

15,000

by bal

15,000

Accounts receivable

To service revenue	35,000	By cash	15,000
		By bal	20,000

Service revenue A/c

		By accounts receivable	35,000
To bal	85,000	By unearned revenue	50,000

Dividends A/c

To cash

5,000

By bal

5,000

Prepaid rent A/c

To cash	12,000	By rent expense	6,000
		By bal	6,000

Rent Expense A/c

To prepaid rent

6,000

By bal

6,000

Supplies expense

To supplies

10,000

By bal

10,000

2. Trial Balance

	Debit	Credit
Cash	163,000
Land	20,000
Supplies	40,000
Accounts receivable	20,000
Prepaid rent	6,000
Office equipment	15,000
Unearned revenue		50,000
Common stock		100,000
Retained earnings		20,000
Bank loan		30,000
Dividend	5,000
Service revenue		85,000
Rent expense	6,000
Supplies expense	10,000
Total	285,000	285,000

3. Income statement

Service revenue		85,000
Less: Rent expense	6,000
Supplies expense	10,000	(16,000)
Net Income		69,000

4. Balance sheet

Assets		Liabilites
Current assets		Unearned revenue	50,000
Cash	163,000	Bank loan	30,000
Supplies	40,000	Total liab	80,000
Account receivable	20,000
Prepaid rent	6,000	Stockholders Equity
Total current assets	229,000	Common stock	100,000
PPE		Retained earnings [20,000 + 69,000 - 5,000]	84,000
Land	20,000
Equipment	15,000
Total PPE	35,000
Total	264,000	Total	264,000