Question

Dee Dee is the owner of a donair and pizza delivery service company, Donair Ltd. In the second month of business, October 2019, a number of business activities took place.

Two months of rent were pre-paid, on October 1, using cash $800, for October and November rent. •

October 10: delivery services were provided for customers, on account, $2000. •

October 12: Dee Dee registered for a business seminar, to be held in December. •

October 13: Dee Dee purchased gas for the company truck, using cash $300. •

October 18: Supplies were purchased on account $200. •

A customer paid $3000 cash on October 25, for services to be provided over the next few weeks. •

The October utility bill was received on October 28, $100. It will be paid in November. •

October 29: Dee Dee withdrew $1000 cash from the business. •

October 30: $500 of delivery services were provided for the customer of October 25. •

October 31: the amount owing re supplies purchase of October 18, was paid in full. •

October 31: customers paid $1000 regarding their accounts with Donair Ltd. •

October 31: one month of rent (October rent, $400) was recorded.

B. Prepare the Trial Balance regarding Donair Ltd journal entries for October.

C. Prepare the Income Statement for Donair Ltd, for the month of October, in good form

Answer 1

A.)	Journal Entries
	Date	Accountt Tiltles	Debit $	Credit $
	October.1	Prepaid Rent	800
		Cash		800
	October.10	Accounts receivable	2,000
		Service Revenue		2,000
	October.12	No Entry
	October.13	Gas Expense	300
		Cash		300
	October.14	Supplies	200
		Accounts Payable		200
	October.25	Cash	3,000
		Unearned Service revenue		3,000
	October.28	Utility Expense	100
		Utility Payable		100
	October.29	Drawing, DEE DEE	1,000
		Cash		1,000
	October.30	Unearned Service revenue	500
		Service revenue		500
	October.31	Accounts Payable	200
		Cash		200
	October.31	Cash	1,000
		Accounts receivable		1,000
	October.31	Rent Expense	400
		Prepaid rent		400

B.)	Trial balance
		Debit $	Credit $
	Cash	1,700
	Accounts receivable	1,000
	Prepaid Rent	400
	Gas Expense	300
	Supplies	200
	Rent Expense	400
	Utility Expense	100
	Utility Payable		100
	Unearned Service revenue		2,500
	Service revenue		2,500
	Drawing, DEE DEE	1,000
	Total	5,100	5,100
			-
C.)	Income Statement
		Amount in $
	Service revenue	2,500
	Less: Gas Expense	300
	Less: Rent Expense	400
	Less: Utility Expense	100
	Net Income	1,700