Question

Journal Entries and Trial Balance

On October 1, 2018, Jay Pryor established an interior decorating business, Pioneer Designs. During the month, Jay completed the following transactions related to the business:

Oct.	1	Jay transferred cash from a personal bank account to an account to be used for the business in exchange for common stock, $23,700.
	4	Paid rent for period of October 4 to end of month, $2,300.
	10	Purchased a used truck for $20,000, paying $2,000 cash and giving a note payable for the remainder.
	13	Purchased equipment on account, $9,240.
	14	Purchased supplies for cash, $1,590.
	15	Paid annual premiums on property and casualty insurance, $3,560.
	15	Received cash for job completed, $9,950.

Enter the following transactions on Page 2 of the two-column journal:

	21	Paid creditor a portion of the amount owed for equipment purchased on October 13, $3,290.
	24	Recorded jobs completed on account and sent invoices to customers, $11,330.
	26	Received an invoice for truck expenses, to be paid in November, $1,040.
	27	Paid utilities expense, $1,190.
	27	Paid miscellaneous expenses, $430.
	29	Received cash from customers on account, $4,740.
	30	Paid wages of employees, $3,150.
	31	Paid dividends, $2,630. 3. Prepare an unadjusted trial balance for Intrex Designs as of October 31, 2018. List all accounts in the order of Assets, Liabilities, Stockholders’ equity, Revenues, and Expenses.For those boxes in which no entry is required, leave the box blank. The first two account titles are filled in as an example. Pioneer Designs Unadjusted Trial Balance October 31, 2018 Debit Balances Credit Balances Cash Accounts Receivable Totals 4. Determine the excess of revenues over expenses for October. $ 5. Why the amount determined in above might not be the net income for October? Because the dividends are declared but not paid Because the cash balance is incorrect. Because the closing inventory balance is missing Because necessary adjustment to expenses, like depreciation has not been made.

Answer 1