Jessica Naboo started her own consulting firm, Naboo Consulting,on May 1, 2007.

ID: 2502210 • Letter: J

Question

Jessica Naboo started her own consulting firm, Naboo Consulting,on May 1, 2007. The trial balance at May 31 is as shown on page205.

NABOO CONSULTING

Trial Balance

May 31, 2007

Debit Credit

Cash$ 7,500

Accounts Receivable 3,000

Prepaid Insurance 3,600

Supplies 2,500

Office Furniture 12,000

Accounts Payable $ 3,500

Unearned Service Revenue 4,000

Common Stock 19,100

Service Revenue 7,500

Salaries Expense 4,000

Rent Expense 1,500

34,100 $34,100

In addition to those accounts listed on the trial balance, thechart of accounts for Naboo

Consulting also contains the following accounts: AccumulatedDepreciation—Office

Furniture, Travel Payable, Salaries Payable, DepreciationExpense, Insurance Expense,

Travel Expense, and Supplies Expense.

Other data:

1. $500 of supplies have been used during the month.

2. Travel costs incurred but not paid are $260.

3. The insurance policy is for 2 years.

4. $1,000 of the balance in the Unearned Service Revenue accountremains unearned at the end of the month.

5. May 31 is a Wednesday and employees are paid on Fridays.Naboo Consulting has two employees that are paid $600 each for a5-day work week.

6. The office furniture has a 5-year life with no salvage valueand is being depreciated at $200 per month for 60 months.

7. Invoices representing $1,400 of services performed during themonth have not been recorded as of May 31.

Instructions

(a) Prepare the adjusting entries for the month of May.

(b) Post the adjusting entries to the ledger accounts. Enter thetotals from the trial balance

as beginning account balances. Use T accounts.

x.x

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