The general ledger of the Karlin Company, a consulting company, at January 1, 20
ID: 2409848 • Letter: T
Question
The general ledger of the Karlin Company, a consulting company, at January 1, 2018, contained the following account balances: Account Title Debits Credits Cash 30,200 Accounts receivable 15,500 Equipment 26,000 Accumulated depreciation 7,800 Salaries payable 8,750 Common stock 46,500 Retained earnings 8,650 Total 71,700 71,700 The following is a summary of the transactions for the year: Sales of services, $124,000, of which $37,200 was on credit. Collected on accounts receivable, $25,300. Issued shares of common stock in exchange for $13,500 in cash. Paid salaries, $45,250 (of which $8,750 was for salaries payable). Paid miscellaneous expenses, $24,400. Purchased equipment for $16,000 in cash. Paid $3,000 in cash dividends to shareholders. Accrued salaries at year-end amounted to $905. Depreciation for the year on the equipment is $2,600. Required: 2., 5, & 8. Prepare the summary, adjusting and closing entries for each of the transactions listed. 3. Post the transactions, adjusting and closing entries into the appropriate t-accounts. 4. Prepare an unadjusted trial balance. 6. Prepare an adjusted trial balance. 7-a. Prepare an income statement for 2018. 7-b. Prepare a balance sheet as of December 31, 2018. 9. Prepare a post-closing trial balance.
Explanation / Answer
2., 5., and 8.
3.
4.
6.
9.
No. General Journal Debit Credit 1 Cash 86800 Accounts receivable 37200 Service revenue 124000 (To record service revenue earned) 2 Cash 25300 Accounts receivable 25300 (To record collections on account) 3 Cash 13500 Common stock 13500 (To record shares issued for cash) 4 Salaries payable 8750 Salaries expense 36500 Cash 45250 (To record salaries paid) 5 Miscellaneous expenses 24400 Cash 24400 (To record miscellaneous expense paid) 6 Equipment 16000 Cash 16000 (To record purchase of equipment) 7 Dividends 3000 Cash 3000 (To record dividends paid) 8 Salaries expense 905 Salaries payable 905 (To record salaries accrued) 9 Depreciation expense 2600 Accumulated depreciation-equipment 2600 (To record depreciation expense) 10 Service revenue 124000 Income summary 124000 (To close revenue account) 11 Income summary 64405 Salaries expense 37405 Miscellaneous expenses 24400 Depreciation expense 2600 12 Income summary 59595 Retained earnings 59595 (To close income summary) 13 Retained earnings 3000 Dividends 3000 (To close dividends)Related Questions
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