Klean Kars, which began operations in October, is enjoying continuing success. T
ID: 2423639 • Letter: K
Question
Klean Kars, which began operations in October, is enjoying continuing success. The November 30, 2011 unadjusted trial balance is as follows:
Klean Kars had the following transactions and events in December 2011
2-Dec Paid $1,025 cash to Hillside Mall for Klean Kars share of mall advertising costs
3-DecPaid $500 cash for minor repairs to company's computer
4-Dec Received $3,950 cash from Jane Smith for a receivable recorded in November
10-Dec Paid cash to Lyn Addie for 6 days of work at the rate of $125 per day. Ignore associated payroll taxes
14-Dec Contacted by James Johnson, who indicated Klean Kars would be hired to perform $7,000 worth of cleaning services over the next 6 months.
14-Dec J. Johnson paid a $1,500 cash advance to Klean Kars and the project is expected to begin on January 15, 2012
15-Dec Purchased $1,100 of cleaning supplies on credit from Harris Office Products
16-Dec Sent a reminder to Suzy Solomon to pay the fee for services recorded on November 8
20-Dec Started and completed a cleaning project for Liu Corporation and received $5,625 cash
28-Dec Received $3,000 cash from Suzy Solomon on her accounts receivable
31-Dec Reimbursed an employee for business automobile mileage - 600 total miles at a rate of $.50 per mile
The following additional facts are collected for use in making adjusting entries prior to preparing financial
The December 31 inventory count of cleaning supplies shows $580 still available
On October 1, 2011, Klean Kars paid their annual insurance premium in the amount of $2,220, which
As of December 31, Lyn Addie has not been paid for 4 days of work at $125 per day
Record depreciation expense for the company's computer in the amount of $1200
Record depreciation expense for the company's office equipment in the amount of $800
On October 1, 2011, Klean Kars signed a 2 year lease agreement, which had the following terms:
** $825 per month ** First 4 months rent due at time of signing (October 1, 2011). ** Payments will be made monthly starting February 1, 2012.
I also need to add an account called cleaning supplies expense that needs to be added on to my adjusted trail balance
Acct No Acct Title Debit Credit 25 Cash 38264 106 Accounte receivable 12618 126 Cleaning supplies 2545 128 Prepaid insurance 2220 131 Prepaid rent 3300 163 Office equipment 8000 164 Accum. Dep - Office equip 0 167 Computer equip 20000 168 Accum. Dep - Computer equip. 0 201 Accounts Payable 0 210 Wages payable 0 236 Unearned Services Revenue 0 301 Common stock 44850 302 Retained earnings 22300 403 Services revenue 25659 612 Depreciation expense - Office Equip 0 613 Depreciation expense - Computer Equip 0 623 Wages expense 2625 637 Insurance expense 0 640 Rent expense 0 655 Advertising expense 1728 676 Mileage expense 704 684 Repairs Expense - Computer 805Explanation / Answer
Journal Entries for Klean Kars for the period ending 31 Dec, 2011 2-Dec Advertising Expense Dr 1025 To Cash Cr 1025 3-Dec Repair-computer Dr 500 To cash Cr 500 4-Dec Cash Dr 3950 To Account receivable Cr 3950 10-Dec Wages Dr 750 To cash Cr 750 14-Dec Cash Dr 1500 To customer Advances Cr 1500 15-Dec Clening Supplies Dr 1100 To accounts Payble Cr 1100 20-Dec cash Dr 5625 To service revenue Cr 5625 28-Dec Cash Dr 3000 To Account receivable Cr 3000 31-Dec Mileage Dr 300 To Cash Cr 300 31-Dec Depriciation Dr 1200 To computer Cr 1200 31-Dec Depriciation Dr 800 To Office equipment Cr 800 31-Dec Rent Dr 2475 To prepaid rent Cr 2475 Trial Balance as on 31 dec, 2011 Particulars Debit Credit Cash 49764 Account receivable 5668 Cleaning supplies 3645 Prepaid insurance 2220 Prepaid rent 825 Office equipment 7200 Computer 18800 Common Stock 44850 Retained earnings 22300 Services revenue 31284 Accounts Payble 1100 Wages expense 3375 Depreciation 2000 Advertising 2753 Mileage 1004 Rent 2475 Repair-Computer 1305 Customer Advances 1500 Total 101034 101034 Profit & Loss A/c for the period ending 31 dec, 2011 Particulars Amount Particulars Amount Wages expense 3375 Services revenue 31284 Depreciation 2000 Advertising 2753 Mileage 1004 Rent 2475 Repair-Computer 1305 Abnormal Loss 3065 To Profit carried to B/s 15307 31284 31284 Balance Sheet as on 31 dec, 2011 Liabilities Amount Assets Amount Common Stock 44850 Cash 49764 Retained earnings 22300 Account receivable 5668 Profit for the year 15307 Cleaning supplies 580 Accounts Payble 1100 Prepaid insurance 2220 Customer Advances 1500 Prepaid rent 825 Office equipment 7200 Computer 18800 85057 85057
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