1. Complete the worksheet for the month. 2. Prepare an income statement, stateme
ID: 2547363 • Letter: 1
Question
1. Complete the worksheet for the month.
2. Prepare an income statement, statement of owner’s equity, and balance sheet. No additional investments were made by the owner during the month.
3. Journalize and post the adjusting entries.
Help Save & Exit Submit Paula Judge owns Judge Creative Designs. The trial balance of the firm for January 31. 2019, the first month of operations, is shown below End-of-the-month adjustments must account for the following items a. Supplies were purchased on January 1, 2019, inventory of supplies on January 31, 2019, is $1200 b. The prepaid advertising contract was signed on January 1, 2019, and covers a four-month period c. Rent of $1,700 expired during the month. epreciation is computed using the straight line method. The equipment has an estimated useful ife of 10 years with no salvage value. Required Complete the worksheet for the month 2. Prepare an income statement, statement of owner's equity, and balance sheet No additional investments were made by the owner during the month. 3. Journalize and post the adjusting entries. Analyze If the adjusting entries had not been made for the month, would net income be overstated or understated?Explanation / Answer
Judge Creative Worksheet Month Ended 31 Jan, 2019 Trial Balance Adjustment Adjusted Trial Balance Income Statement Balance sheet Account Name Debit Credit Debit Credit Debit Credit Debit Credit Debit Credit Cash $35,700 $35,700 $35,700 Acount Receivabe $12,800 $12,800 $12,800 Supplies $8,150 $6,950 $1,200 $1,200 Prepaid Advertising $9,200 $2,300 $6,900 $6,900 Prepaid Rent $20,400 $1,700 $18,700 $18,700 Equipment $24,000 $24,000 $24,000 Accumulated Depreciation $2,400 $2,400 $2,400 Account Payable $15,750 $15,750 $15,750 Paula Judge, Capital $60,200 $60,200 $39,550 $99,750 Paula Judge Drawing $7,200 $7,200 $7,200 Fees Income $52,900 $52,900 $52,900 Advertising Expense $2,300 $2,300 $2,300 Supplies Expense $6,950 $6,950 $6,950 Rent Expense $1,700 $1,700 $1,700 Depreciation Expense $2,400 $2,400 $2,400 $117,450 $128,850 $13,350 $13,350 $119,850 $131,250 $52,900 $52,900 $106,500 $117,900 Note : in question Un matched trial balance that's the reason for not matching the balancesheet Judge Creative Judge Creative Supplies Account 121 Income Statement Statement of Owner Equity Date Debit Credit balance Month Ended 31 Jan, 2019 Month Ended 31 Jan, 2019 31-Jan $8,150 $8,150 Revenue Beginning Balance of Capital A/c $60,200 31-Jan $6,950 $1,200 Fees Income $52,900 Net Income for the year $39,550 Total Revenue $52,900 Drawing -$7,200 Prepaid Rent Account 121 Ending Capital Balance $92,550 Date Debit Credit balance Expenses 31-Jan $20,400 $20,400 Advertising Expense $2,300 Judge Creative 31-Jan $1,700 $18,700 Supplies Expense $6,950 Income Statement Rent Expense $1,700 Month Ended 31 Jan, 2019 Advertising Expense Account 121 Depreciation Expense $2,400 Asset Date Debit Credit balance Total Expense $13,350 Current Asset 31-Jan $2,300 $2,300 Cash $35,700 31-Jan $2,300 $0 Net Income $39,550 Acount Receivabe $12,800 Supplies $1,200 Supplies Expense Account 121 Journal Entry Prepaid Advertising $6,900 Date Debit Credit balance Account , Explantation Debit Credit Prepaid Rent $18,700 31-Jan $6,950 $6,950 Supplies Expense $6,950 Total Current Asset $75,300 $75,300 31-Jan $6,950 $0 To Supplies $6,950 Equipment $24,000 Advertisement Expense $2,300 Accumularted Depreciation -$2,400 $21,600 Prepaid Advertising Account 121 To Prepaid Advertising $2,300 Date Debit Credit balance Total Asset $96,900 31-Jan $9,200 $9,200 Rent Expense $1,700 31-Jan $2,300 $6,900 To Prepaid Rent $1,700 Liabilities & Owner Equities Liabilities Depreciation Expense $2,400 Account Payable $1,570 To Accumulated Depreciation $2,400 Accumulated Dep Account 121 Owner Equities Date Debit Credit balance Paula Judge, Capital $92,550 31-Jan $2,300 $2,300 Total Liabilities & Equity $94,120
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