Problem 3-6A Applying the accounting cycle LO P1, P2, P3, P4, P5 On April 1, 201
ID: 2336809 • Letter: P
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Problem 3-6A Applying the accounting cycle LO P1, P2, P3, P4, P5 On April 1, 2017, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the company's first month. April 1 Nozomi invested $35,000 cash and computer equipment worth $40,000 in the company in exchange for common stock 2 The company rented furnished office space by paying $2,100 cash for the first month's (April) rent. 3 The company purchased $1,300 of office supplies for cash. 10 The company paid $3,000 cash for the premium on a 12-month insurance policy. Coverage begins on April 11 14 The company paid $1,000 cash for two weeks' salaries earned by employees. 24 The company collected $23,000 cash on commissions from airlines on tickets obtained for customers 28 The company paid $1,000 cash for two weeks' salaries earned by employees. 29 The company paid $450 cash for minor repairs to the company's computer. 30 The company paid $850 cash for this month's telephone bill. 30 The company paid $2,500 cash in dividends The company's chart of accounts follows:Explanation / Answer
Jiro Nizomi Journal Entries Date Particular Amt(DR) Amt(CR) 01-Apr Cash $ 35,000.00 Computer Equipment $ 40,000.00 To Jiro Nizomi's Capital $ 75,000.00 (Being amount invested by Nizomi) 02-Apr Rent Expenes $ 2,100.00 To Cash $ 2,100.00 (Being amount of Rent paid for the month of April) 03-Apr Office Supplies $ 1,300.00 To Cash $ 1,300.00 (Being amount of purchase of Office supplies) 10-Apr Prepaid Insurance $ 3,000.00 To Insurance $ 3,000.00 (Being amount of Insurance Premium paid for 12 months) 14-Apr Salaries $ 1,000.00 To Cash $ 1,000.00 (Beign amount of two weeks Salaries paid to employees ) 24-Apr Cash $ 23,000.00 To Commission received $ 23,000.00 (Being amount of Cash received from airlines) 28-Apr Salaries $ 1,000.00 To Cash $ 1,000.00 (Beign amount of two weeks Salaries paid to employees ) 29-Apr Repair Expenses $ 450.00 To Cash $ 450.00 (being amount paid for computer repairs) 30-Apr Telephone Expenses $ 850.00 To Cash $ 850.00 (Being amount paid for telephone bill for the month) 30-Apr Dividend $ 2,500.00 To Cash $ 2,500.00 (Being amount of dividend paid) Cash Date Particular Amt (DR) Amount (Cr) Balance 01-Apr Jero Nizom's Capital $ 35,000.00 $ 35,000.00 02-Apr Rent Expenes $ 2,100.00 $ 32,900.00 03-Apr Office Supplies $ 1,300.00 $ 31,600.00 10-Apr Prepaid Insurance $ 3,000.00 $ 28,600.00 14-Apr Salaries $ 1,000.00 $ 27,600.00 24-Apr Commission Receive $ 23,000.00 $ 50,600.00 28-Apr Salaries $ 1,000.00 $ 49,600.00 29-Apr Repairs $ 450.00 $ 49,150.00 30-Apr Telephone Expenses $ 850.00 $ 48,300.00 30-Apr Dividend $ 2,500.00 $ 45,800.00 Jiro Nizom's Capital Date Particular Amt (DR) Amount (Cr) Balance 01-Apr Cash $ 35,000.00 $ 35,000.00 01-Apr Computer Equipment $ 40,000.00 75,000.00 Computer Equipment Date Particular Amt (DR) Amount (Cr) Balance 01-Apr Jero Nizom's Capital $ 40,000.00 $ - $ 40,000.00 Rent Expenses Date Particular Amt (DR) Amount (Cr) Balance 02-Apr Cash $ 2,100.00 $ 2,100.00 Office Supplies Date Particular Amt (DR) Amount (Cr) Balance 03-Apr Cash $ 1,300.00 $ 1,300.00 Prepaid Insurance Date Particular Amt (DR) Amount (Cr) Balance 03-Apr Cash $ 3,000.00 $ 3,000.00 Salaries Expenses Date Particular Amt (DR) Amount (Cr) Balance 14-Apr Cash $ 1,000.00 $ 1,000.00 28-Apr Cash $ 1,000.00 $ 2,000.00 Commission Received Date Particular Amt (DR) Amount (Cr) Balance 24-Apr Cash $ 23,000.00 $ 23,000.00 Repairs Date Particular Amt (DR) Amount (Cr) Balance 29-Apr Cash $ 450.00 $ 450.00 Telephone Expenses Date Particular Amt (DR) Amount (Cr) Balance 30-Apr Cash $ 850.00 $ 850.00 Dividend Date Particular Amt (DR) Amount (Cr) Balance 30-Apr Cash $ 2,500.00 $ 2,500.00 Jero Nizome Unadjusted Trial Balance For the Month Ended April 30th, 2017 Account Title & Explaination Amt (Dr) Amt (Cr) Cash $ 45,800.00 Office Supplies $ 1,300.00 Computer Equipment $ 40,000.00 Commission Earned $ 23,000.00 Jero Nizome's Capital $ 75,000.00 Salary Expenses $ 2,000.00 Rent Expenses $ 2,100.00 Insurance Expenses $ 3,000.00 Telephone Expenses $ 850.00 Repairs Expenses $ 450.00 Dividend $ 2,500.00 Total $ 98,000.00 $ 98,000.00 Jero Nizome Income Statement - Commission Earned $ 23,000.00 Expenses Salary Expenses $ 2,000.00 Rent Expenses $ 2,100.00 Insurance Expesnes $ 3,000.00 Telephone Expenses $ 850.00 Repairs Expenses $ 450.00 Dividend $ 2,500.00 Total Expenses=(B) $ 10,900.00 Net Income(A)-(B) $ 12,100.00 Jero Nizome Statement of Owner's Equity April 30th Beginning Retained Earnings 0 Add: Net Income $ 12,100.00 Ending Retained Earnings $ 12,100.00 Jero Nizome Balance Sheet April 30th Assets Cash $ 45,800.00 Supplies $ 1,300.00 Computer Equipment $ 40,000.00 Total Assets $ 87,100.00 Liabilities & Stockholder's equity Liabilities $ - Stockholder's Equity Common Stock $ 75,000.00 Retained Earnings $ 12,100.00 Total Equity $ 87,100.00 Total Liabilities & Stockholder's Equity $ 87,100.00
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