1.) Prepare an Income Statement, Statement of Owner’s Equity, and a Balance Shee
ID: 2450802 • Letter: 1
Question
1.) Prepare an Income Statement, Statement of Owner’s Equity, and a Balance Sheet as of July 31, 2014, Journalize and post the closing entries, Prepare a Post-Closing Trial Balance
Journal entries
Date
Description
Debit
Credit
July 1
Cash
$4,000
To Chris Browns capital
$4,000
Office rent expense
$1800
To cash
$1800
Prepaid insurance
$2,700
To cash
$2,700
July 2
Cash
$1250
To A/c receivable
$1250
July 3
cash
$7,200
to unearned revenue
$7,200
July 3
A/c payable
$250
To cash
$250
July 4
Legal expense
$800
To cash
$800
July 5
Office equipment
$6000
To A/c payable
$6000
July 8
Advertisement expense
$200
To Cash
$200
July 11
Cash
$900
to fees earned
$900
July 13
Equipment rental expense
$600
To cash
$600
July 14
Wages expense
$1200
To cash
$1200
July 16
Cash
$1200
To fees earned
$1200
July 18
Office supplies a/c
$1080
To a/c payable
$1080
July 21
Utilities expense
$620
To cash
$620
July 22
Advertising expense
$800
To cash
$800
July 23
Cash
$750
A/c receivable
$1750
To fees earned
$2500
July 23
Utility expense
$760
To cash
$760
July 28
Wages & expense
$1200
To cash
$1200
July 29
Miscellaneous expense
$370
To cash
$370
July 30
Cash
$400
A/c receivable
$1400
To fees earned
$1800
July 31
Cash
$2800
To fees earned
$2800
July 31
Music expense
$1400
To cash
$1400
July 31
Drawings
$1500
To cash
$1500
Unadjusted trial balance
Debit
Credit
Cash
$9610
A/c receivable
$3150
Supplies
$1250
Prepaid insurance
$2700
Office equipment
$6000
Accumulated dep
A/c payable
7080
unearned revenue
7200
Chris browns capital
9000
Drawings
2000
fees earned
15,850
wage expense
2800
office rent expense
2550
Equipment rental expense
1300
music expense
2990
Advertisement expense
1450
supplies expense
180
legal expense
misc. expense
670
Utility expense
1680
total
$39,130
$39130
Adjusting entries
A/c receivable
$1600
to unearned revenue
$1600
Supplies expense
$850
To Supplies
$850
insurance expense
$225
to Prepaid rent
$225
Depreciation expense
$75
To Accumulated dep
$75
Unearned revenue
$3600
To Fees earned
$3600
Wages expense
$170
To wages payable
$170
Adjusted trial balance
Debit
Credit
Cash
$9610
A/c receivable
$4750
Supplies
$400
Prepaid insurance
$2475
Office equipment
$6000
Accumulated dep
75
A/c payable
7080
unearned revenue
5200
Chris browns capital
9000
Drawings
2000
fees earned
19,450
wage expense
2970
office rent expense
2550
Equipment rental expense
1300
music expense
2990
Advertisement expense
1450
supplies expense
1030
legal expense
800
misc. expense
670
Utility expense
1680
Wages payable
170
insurance expense
225
Depreciation expense
75
total
40975
40975
Date
Description
Debit
Credit
July 1
Cash
$4,000
To Chris Browns capital
$4,000
Office rent expense
$1800
To cash
$1800
Prepaid insurance
$2,700
To cash
$2,700
July 2
Cash
$1250
To A/c receivable
$1250
July 3
cash
$7,200
to unearned revenue
$7,200
July 3
A/c payable
$250
To cash
$250
July 4
Legal expense
$800
To cash
$800
July 5
Office equipment
$6000
To A/c payable
$6000
July 8
Advertisement expense
$200
To Cash
$200
July 11
Cash
$900
to fees earned
$900
July 13
Equipment rental expense
$600
To cash
$600
July 14
Wages expense
$1200
To cash
$1200
July 16
Cash
$1200
To fees earned
$1200
July 18
Office supplies a/c
$1080
To a/c payable
$1080
July 21
Utilities expense
$620
To cash
$620
July 22
Advertising expense
$800
To cash
$800
Explanation / Answer
Income statement for the period ended July 31, 2014
Fees earned
19,450
Total Revenue
19,450
wage expense
2,970
office rent expense
2,550
Equipment rental expense
1,300
music expense
2,990
Advertisement expense
1,450
supplies expense
1,030
legal expense
800
misc. expense
670
Utility expense
1,680
insurance expense
225
Depreciation expense
75
Total Expenses
15,740
Net Income
3,710
Statement of Equity, Assets and liabilities as of July 31, 2014
Assets:
Current Assets:
Cash
9,610
A/c receivable
4,750
Supplies
400
Prepaid insurance
2,475
Total Current Assets
17,235
Fixed assets:
Office equipment
6,000
Less: Accumulated depreciation
75
Total Fixed assets
5,925
Total Assets
23,160
Liabilities and Equity:
Current liabilities
A/c payable
7,080
unearned revenue
5,200
Wages payable
170
Total Current liabilities
12,450
Equity
Chris browns capital
9,000
Less: Drawings
2,000
Add: Net income
3,710
Total Equity
10,710
Total Liabilities and Equity
23,160
Closing Entries:
Income statement for the period ended July 31, 2014
Fees earned
19,450
Total Revenue
19,450
wage expense
2,970
office rent expense
2,550
Equipment rental expense
1,300
music expense
2,990
Advertisement expense
1,450
supplies expense
1,030
legal expense
800
misc. expense
670
Utility expense
1,680
insurance expense
225
Depreciation expense
75
Total Expenses
15,740
Net Income
3,710
Statement of Equity, Assets and liabilities as of July 31, 2014
Assets:
Current Assets:
Cash
9,610
A/c receivable
4,750
Supplies
400
Prepaid insurance
2,475
Total Current Assets
17,235
Fixed assets:
Office equipment
6,000
Less: Accumulated depreciation
75
Total Fixed assets
5,925
Total Assets
23,160
Liabilities and Equity:
Current liabilities
A/c payable
7,080
unearned revenue
5,200
Wages payable
170
Total Current liabilities
12,450
Equity
Chris browns capital
9,000
Less: Drawings
2,000
Add: Net income
3,710
Total Equity
10,710
Total Liabilities and Equity
23,160
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