Connect-Class: Accoul M MHE Reader general ledger-Bing r ? Acct l Exam 1 Summ ×

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Connect-Class: Accoul M MHE Reader general ledger-Bing r ? Acct l Exam 1 Summ × Acct Prin l Exam 1-AC How to Take a Screen S | + v ? ? ?fù ? https: /howard blackboard.com bbcswebdav pid-2194337 dt content rid-6124953-1/courses/ACCT20180201 805 Acct%201%20Exam%201 Comprehensive problem- The Accounting Cycle On August 1, 2018, David McKinsey created a company, McKinsey Consulting. The following transactions occurred during the company's first month Aug Anthony invested $120,000 cash and computer equipment worth $50,000 in the com- pany in exchange for common stock. The company rented furnished office space by prepaying $4,500 for the first 5 month's rent 1 The company purchased $5,000 of office supplies on credit 1 The company paid $4,800 for the premium on a 12-month insurance policy 8 The company agreed to perform a long tem consulting contract for a client, Mr. Roo- ney, who paid $30,000 upfront to McKinsey Consulting. 14 The company paid $7,000 for two weeks' salaries eamed by employees 24 The company collected $60,000 from consulting services performed for Ms. Tate. 28 The company paid $7,000 for two weeks' salaries eamed by employees. 29 The company paid $1,900 for repairs to the company's computer. 30 The company paid $1,200 for this month's telephone bill 30 The company paid $1,800 for dividends. 1. Prepare joumal entries to record McKinsey Consulting's transactions for its first month of operations. SKIP A LINE BETWEEN EACH JOURNAL ENTRY. Explanations are not required. 2. Post the journal entries to the general ledger and calculate each account's ending balance. 3. Prepare an unadjusted trial balance on the trial balance worksheet. List the accounts in the correct order, On August 31, McKinsey Consulting reviewed its books and noted the following a. One month's insurance coverage has expired b. At the end of the month, $1,900 of office supplies is still available c. This month's depreciation on the computer equipment is $3,500 d. Employees earned $1,850 of unpaid and unrecorded salaries for the pod August 29-31 e. The company eamed $5,250 of consulting fees that are not yet billed at month-end f. On August 31, the unearned balance on Mr. Rooney's consulting contract is $20,000 Record the company's rent expense for August. 4. Prepare adjusting journal entries to record these transactions. SKIP A LINE BETWEEN EACH JOUR-

Explanation / Answer

Journal Entries for the Month Ended of August 2018 Amount in $ Date Particulars Debit Credit Cash Ledger Assets Aug-01 Cash 120000 Debit Credit Prepaid rent 4500 Expenses Office Equipment 50000 120000 4500 Prepaid insurance 4800 Office supplies 5000       Common Stock (CR) 170000 30000 4800 salaries 7000+7000 60000 7000 Repairs 1900 Aug-01 Prepaid Office Rent 4500 7000 Utility Bill 1200         Cash 4500 1900 Dividends paid 1800 1200 Aug-01 Office Supplies 5000 1800     Accounts Payable 5000 Total 210000 28200 Aug-01 Prepaid insurance 4800 181800 revenue       cash 4800 Liabilities sale of service 60000 Aug-08 Cash 30000 Accounts Payable 5000 Unearned Income 30000 unearned income 30000 Office Equipment Aug-14 Salaries 7000 Debit Credit      cash 7000 50000 Aug-24 cash 60000 Sale of service 60000 Accounts Payable Aug-28 Salaries 7000 Debit Credit      cash 7000 5000 Aug-29 Repairs 1900 cash 1900 Unearned Income Debit Credit Aug-30 Utility bill 1200 30000 cash 1200 Aug-30 Dividends 1800 Prepaid Rent Cash 1800 Debit Credit 4500 Prepaid Insurance Debit Credit 4800 Amount($) Unadjusted Trail Balance for the Month of Aug 2018 Debit Credit Cash 181800 Office Equipment 50000 Accounts Payable 5000 Unearned Income 30000 Prepaid Rent 4500 Prepaid Insurance 4800 Office Supplies 5000 Salaries Paid 14000 Repairs 1900 Utility Bill 1200 Dividends paid 1800 sale of service 60000 Common Stock 170000                                                                              Total 265000 265000 Preparing Adjustment Entries Amount($) Date Particulars Debit Credit Aug-31 Rent 900 Prepaid Rent 900 Aug-31 Insurance 400      Prepaid Insurance 400 Aug-31 Salaries 1850      Salaries Payable 1850 Aug-31 cash 5250 sale of service 5250 Aug-31 Unearned Income 10000     Sale of service 10000 Aug-31 Stock 1900 Office Supplies 1900 Aug-31 Depreciation 3500 Accumalated Depreciation 3500

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