Question

Transaction Analysis and Trial Balance

BC Back-Country Airlines, Inc., operates leased amphibious aircraft and docking facilities, equipping the firm to transport campers and hunters from British Columbia, Canada, to outpost camps owned by various resorts. On August 1, the firm's trial balance was as follows:

BC BACK-COUNTRY AIRLINES, INC. Unadjusted Trial Balance August 1, 2016
	Debit	Credit
Cash	$83,400
Accounts Receivable	24,000
Accounts Payable		$2,500
Notes Payable		3,800
Common Stock		80,000
Retained Earnings		21,100
Totals	$107,400	$107,400

During August, the following transactions occurred:

Aug	1	Paid August rental cost for aircraft, dockage, and dockside office, $6,800.
	2	Paid the insurance premium for August, $3,600.
	3	Paid for August advertising in various sports magazines, $2,300.
	4	Rendered fly-in services for various groups for cash, $17,550.
	5	Billed the Canadian Ministry of Natural Resources for services in transporting mapping personnel, $4,700.
	6	Received $21,200 on account from clients.
	7	Paid $2,500 on accounts payable.
	8	Billed various clients for services, $20,200.
	9	Paid interest on an outstanding note payable for August, $155.
	10	Paid August wages, $15,600.
	11	Received invoice for the cost of fuel used during August, $4,400.
	12	Paid a cash dividend, $5,300 (debit Retained Earnings).

Cash
Beg	Answer	Answer
(1)	Answer	Answer
(2)	Answer	Answer
(3)	Answer	Answer
(4)	Answer	Answer
(6)	Answer	Answer
(7)	Answer	Answer
(9)	Answer	Answer
(10)	Answer	Answer
(12)	Answer	Answer
Bal	Answer	Answer

Accounts Receivable
Beg	Answer	Answer
(5)	Answer	Answer
(6)	Answer	Answer
(8)	Answer	Answer
Bal	Answer	Answer

Notes Payable
Beg	Answer	Answer
Bal	Answer	Answer

Accounts Payable
Beg	Answer	Answer
(7)	Answer	Answer
(11)	Answer	Answer
Bal	Answer	Answer

Common Stock
Beg	Answer	Answer
Bal	Answer	Answer

Retained Earnings
Beg	Answer	Answer
(12)	Answer	Answer
Bal	Answer	Answer

Interest Expense
(9)	Answer	Answer
Bal	Answer	Answer

Service Fees Earned
(4)	Answer	Answer
(5)	Answer	Answer
(8)	Answer	Answer
Bal	Answer	Answer

Rent Expense
(1)	Answer	Answer
Bal	Answer	Answer

Wage Expense
(10)	Answer	Answer
Bal	Answer	Answer

Insurance Expense
(2)	Answer	Answer
Bal	Answer	Answer

Advertising Expense
(3)	Answer	Answer
Bal	Answer	Answer

Fuel Expense
(11)	Answer	Answer
Bal	Answer	Answer

b. Prepare a trial balance as of August 31, 2016.

BC BACK-COUNTRY AIRLINES, INC. Trial Balance August 31,2016
		Debit		Credit
Cash		$Answer		$Answer
Accounts Receivable		Answer		Answer
Accounts Payable		Answer		Answer
Notes Payable		Answer		Answer
Common Stock		Answer		Answer
Retained Earnings		Answer		Answer
Service Fees Earned		Answer		Answer
Wage Expense		Answer		Answer
Advertising Expense		Answer		Answer
Rent Expense		Answer		Answer
Fuel Expense		Answer		Answer
Insurance Expense		Answer		Answer
Interest Expense		Answer		Answer
Totals		$Answer		$Answer Transaction Analysis and Trial Balance BC Back-Country Airlines, Inc., operates leased amphibious aircraft and docking facilities, equipping the firm to transport campers and hunters from British Columbia, Canada, to outpost camps owned by various resorts. On August 1, the firm's trial balance was as follows: BC BACK-COUNTRY AIRLINES, INC. Unadjusted Trial Balance August 1, 2016 Debit Credit Cash $83,400 Accounts Receivable 24,000 Accounts Payable $2,500 Notes Payable 3,800 Common Stock 80,000 Retained Earnings 21,100 Totals $107,400 $107,400 During August, the following transactions occurred: Aug 1 Paid August rental cost for aircraft, dockage, and dockside office, $6,800. 2 Paid the insurance premium for August, $3,600. 3 Paid for August advertising in various sports magazines, $2,300. 4 Rendered fly-in services for various groups for cash, $17,550. 5 Billed the Canadian Ministry of Natural Resources for services in transporting mapping personnel, $4,700. 6 Received $21,200 on account from clients. 7 Paid $2,500 on accounts payable. 8 Billed various clients for services, $20,200. 9 Paid interest on an outstanding note payable for August, $155. 10 Paid August wages, $15,600. 11 Received invoice for the cost of fuel used during August, $4,400. 12 Paid a cash dividend, $5,300 (debit Retained Earnings). Required a. Set up accounts for each item in the August 1 trial balance and enter the beginning balances. Also provide similar accounts for the following items: Service Fees Earned, Wage Expense, Advertising Expense, Rent Expense, Fuel Expense, Insurance Expense and Interest Expense. Create journal entries and record the transactions for August in the appropriate T-accounts, using the dates given. . Cash Beg Answer Answer (1) Answer Answer (2) Answer Answer (3) Answer Answer (4) Answer Answer (6) Answer Answer (7) Answer Answer (9) Answer Answer (10) Answer Answer (12) Answer Answer Bal Answer Answer Accounts Receivable Beg Answer Answer (5) Answer Answer (6) Answer Answer (8) Answer Answer Bal Answer Answer Notes Payable Beg Answer Answer Bal Answer Answer Accounts Payable Beg Answer Answer (7) Answer Answer (11) Answer Answer Bal Answer Answer Common Stock Beg Answer Answer Bal Answer Answer Retained Earnings Beg Answer Answer (12) Answer Answer Bal Answer Answer Interest Expense (9) Answer Answer Bal Answer Answer Service Fees Earned (4) Answer Answer (5) Answer Answer (8) Answer Answer Bal Answer Answer Rent Expense (1) Answer Answer Bal Answer Answer Wage Expense (10) Answer Answer Bal Answer Answer Insurance Expense (2) Answer Answer Bal Answer Answer Advertising Expense (3) Answer Answer Bal Answer Answer Fuel Expense (11) Answer Answer Bal Answer Answer b. Prepare a trial balance as of August 31, 2016. BC BACK-COUNTRY AIRLINES, INC. Trial Balance August 31,2016 Debit Credit Cash $Answer $Answer Accounts Receivable Answer Answer Accounts Payable Answer Answer Notes Payable Answer Answer Common Stock Answer Answer Retained Earnings Answer Answer Service Fees Earned Answer Answer Wage Expense Answer Answer Advertising Expense Answer Answer Rent Expense Answer Answer Fuel Expense Answer Answer Insurance Expense Answer Answer Interest Expense Answer Answer Totals $Answer $Answer

Answer 1

a.

Transaction	Account Titles and Explanation	Debit	Credit
1	Rent expense	6800
	Cash		6800
	(To record rent expense paid)
2	Insurance expense	3600
	Cash		3600
	(To record insurance expense paid)
3	Advertising expense	2300
	Cash		2300
	(To record advertising expense paid)
4	Cash	17550
	Service fees earned		17550
	(To record services rendered for cash)
5	Accounts receivable	4700
	Service fees earned		4700
	(To record services billed)
6	Cash	21200
	Accounts receivable		21200
	(To record receipt on account)
7	Accounts payable	2500
	Cash		2500
	(To record payment on account)
8	Accounts receivable	20200
	Service fees earned		20200
	(To record services billed)
9	Interest expense	155
	Cash		155
	(To record interest expense paid)
10	Wage expense	15600
	Cash		15600
	(To record wage expense paid)
11	Fuel expense	4400
	Accounts payable		4400
	(To record invoice for cost of fuel)
12	Retained earnings	5300
	Cash		5300
	(To record cash dividend paid)

Cash
Beg	83400
1		6800
2		3600
3		2300
4	17550
6	21200
7		2500
9		155
10		15600
12		5300
Bal	85895
Accounts Receivable
Beg	24000
5	4700
6		21200
8	20200
Bal	27700
Notes Payable
Beg		3800
Bal		3800
Accounts Payable
Beg		2500
7	2500
11		4400
Bal		4400
Common Stock
Beg		80000
Bal		80000
Retained Earnings
Beg		21100
12	5300
Bal		15800
Interest Expense
9	155
Bal	155
Service Fees Earned
4		17550
5		4700
8		20200
Bal		42450
Rent Expense
1	6800
Bal	6800
Wage Expense
10	15600
Bal	15600
Insurance Expense
2	3600
Bal	3600
Advertising Expense
3	2300
Bal	2300
Fuel Expense
11	4400
Bal	4400

b.

BC BACK-COUNTRY AIRLINES, INC.
Trial Balance
August 31, 2016
	Debit	Credit
Cash	85895
Accounts receivable	27700
Accounts payable		4400
Notes payable		3800
Common stock		80000
Retained earnings		15800
Service fees earned		42450
Wage expense	15600
Advertising expense	2300
Rent expense	6800
Fuel expense	4400
Insurance expense	3600
Interest expense	155
Totals	146450	146450