Comprehensive Problem: Making Paper Music Company Complete the following compreh

Question

Comprehensive Problem: Making Paper Music Company Complete the following comprehensive problem by following the accounting cycle with the exception of the worksheet. Making Paper Music Company Owner: Chris Brown Chart of Accounts as of July 1, 2014 11 Cash $5,310 12 Accounts Receivable $1,250 14 Supplies $170 15 Prepaid Insurance $0 17 Office Equipment $0 18 Accumulated Depreciation $0 21 Accounts Payable $250 22 Wages Payable $0 23 Unearned Revenue $0 31 Chris Brown, Capital $5,000 32 Chris Brown, Drawing $500 41 Fees Earned $6,650 50 Wages Expense $400 51 Office Rent Expense $750 52 Equipment Rental Expense $700 53 Utilities Expense $300 54 Music Expense $1,590 55 Advertising Expense $450 56 Supplies Expense $180 57 Legal Expenses $0 58 Insurance Expense $0 59 Miscellaneous Expense $300 60 Depreciation Expense $0 *Accounts Payable—Mega Music Café is the vendor the $250 is owed to *Accounts Receivable-- Wiz Kalefa is the customer’s name that owes the $1250 1. Post the beginning balances shown in the Chart of Accounts above in the ledgers. 2. Journalize and post the following transactions: July 1: Chris Brown made an additional investment in the Making Paper Music Company by depositing $4,000 in the bank. July 1: Procured office space near a local music store and paid the rent for July of $1,800. July 1: Prepaid a one year insurance policy to State Farm for $2700. July 2: Received a check from Wiz Khalifa for payment on his account, $1250. July 3: Chris Brown signed a contract with Local Artist radio station to provide guest spots for the next three months. The contract requires Chris to provide services for 80 hours per month for $3600 (per month) and any additional hours over 80 are billed at $40 per hour. July 3: Chris Brown receives an advance payment from Local Artist radio station in the amount of $7200 pertaining to the contract signed. July 3: Wrote a check to Mega Music Café for the amount owed July 4: Met with an attorney to have the contract with Local Artist Radio reviewed and paid the legal fees in full--$800 July 5: Purchased office equipment from Office Depot for $6,000 and placed on account July 8: Paid the Atlanta Journal Constitution $200 for an advertisement in the Sunday paper July 11: Received $900 cash for singing at a party July 13: Paid $600 to Capricorn Records to rent some studio equipment July 14: Paid Lil Wayne $1,200 for assisting with parties and recording July 16: Received $1200 for singing at a party July 18: Purchased supplies from Office Depot on account $1080 July 21: Paid $620 to Digital Music for the use of music demos July 22: Paid $800 to Jam Time Radio Station to advertise the services of Making Paper Music Company twice daily for the remainder of the month July 23: Sang at a party for Sean Combs and charged $2500. $750 was paid in cash on the spot and the remainder was billed in an invoice July 27: Paid $760 to Georgia Power for the electric bill July 28: Paid wages of $1200 to Lil Wayne for assisting with parties and recording July 29: Paid $370 in various miscellaneous expenses July 30: Sang at Missy Elliot’s Charity Ball and charged $1800. $400 was paid in cash on the spot and the remainder was billed in an invoice July 31: Received $2800 for singing at a party July 31: Paid $1400 in royalties to Motown Music for the use of others music July 31: Chris Brown withdrew $1500 for personal bills 3. Prepare an Unadjusted Trial Balance for July 31, 2014 4. Journalize and post the following adjusting entries as of July 31, 2014 • Record the accrued revenues of $1600 • Supplies on hand at the end of the month $400 • Adjust the prepaid insurance account for one month • Record the depreciation for the Office Equipment $75 • Adjust the unearned revenue account for one month of revenues earned from Local Artist Radio • Record the accrued wages, to Lil Wayne, of $170 5. Prepare an Adjusted Trial Balance as of July 31, 2014 6. Prepare an Income Statement, Statement of Owner’s Equity, and a Balance Sheet as of July 31, 2014 7. Journalize and post the closing entries 8. Prepare a Post-Closing Trial Balance

Explanation / Answer

Figures in the question are not clear

E.g

Supplies $170 15 Prepaid Insurance $0 17

Supplies are $170 or $170.15

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