The general ledger of Pipers Plumbing at January 1, 2012, includes the following

Question

The general ledger of Pipers Plumbing at January 1, 2012, includes the following account balances:
Accounts                                                Debits                  Credits
Cash                                                    $ 3,000
Accounts receivable                                7,500
Supplies                                                  2,500
Equipment                                              20,000
Accumulated depreciation                                                      $ 3,500
Accounts payable                                                                     4,000
Utilities payable                                                                       5,000
Unearned revenue                                                                        0
Common stock                                                                        16,000
Retained earnings                                                                     4,500


Totals                                                   $ 33,000                    $ 33,000

The following is a summary of the transactions for the year:
a. Provide plumbing services for cash, $16,500, and on account, $66,000.
b. Collect on accounts receivable, $50,000.
c. Issue shares of common stock in exchange for $10,000 cash.
d. Pay salaries for the current year, $31,500.
e. Pay for utilities expenses, $11,500, of which $5,000 represents costs for 2011.
f. Receive cash in advance from customers, $8,500.
g. Pay $2,000 cash dividends to stockholders.

 

Do the following:

 

a. Record each of the summary transactions listed above in a general journal.

 

b. Prepare an unadjusted trial balance. (Leave no cells blank - be certain to enter "0" wherever required. The items in the Trial Balance should be grouped as follows: Assets, Liabilities (in order of their liquidity), Equity, Revenues, and Expenses)

 

 

 

c. Record adjusting entries. Depreciation for the year on the machinery is $3,500. Plumbing supplies remaining on hand at the end of the year equal $1,100. Of the $8,500 paid in advance by customers, $5,500 of the work has been completed by the end of the year. (Record the transactions in the given order)

 

 

Explanation / Answer

Date

Particulars

L/F

Dr $

Cr $

Unadjusted trial balance

Particulars

Dr

Cr

Date

Particulars

L/F

Dr $

Cr $

Date

Particulars

L/F

Dr $

Cr $

a Cash 16,500 Accounts receivables 66,000                 Service revenue 82,500 (entry to record service revenue) b Cash 50,000                Accounts receivables 50,000 (entry to record the collection of cash) c Cash 10,000               Capital stock 10,000 (entry to record the issue of common stock) d Salaries expenses 31,500                   Cash 31,500 e Utilities expenses payable 5,000 Utilities expenses   6,500             Cash 11,500 (entry to record the pay for utilities expenses for 2011 and 12) f Cash 8,500            Unearned service revenue 8,500 (enrty to record the unearned service revenue) g Dividends paid 2,000                Cash 2,000

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