Accounting Cycle Review 4-4 (Part Level Submission) At June 30, 2017, the end of
ID: 2549844 • Letter: A
Question
Accounting Cycle Review 4-4 (Part Level Submission) At June 30, 2017, the end of its most recent fiscal year, Bramble Computer Consultants' post-closing trial balance was as follows: Debit Credit $4,080 940 540 Cash Accounts receivable Supplies Accounts payable Unearned service revenue Common stock Retained earning:s $310 870 2,800 1,580 $5,560$5,560 The company underwent a major expansion in July. New staff was hired and more financing was obtained. Bramble conducted the following transactions during July 2017, and adjusts its accounts monthly. Purchased equipment, paying $3,600 cash and signing a 2-year note payable for $15,600. The equipment has a 4-year useful life. The note has a 6% interest rate which is payable on the first day of each following month July1 2Issued 15,600 shares of common stock for $39,000 cash. 3 Paid $3,000 cash for a 12-month insurance policy effective July 1. 3 Paid the first 2 (July and August 2017) months' rent for an annual lease of office space for $3,100 per month. 6 Paid $3,000 for supplies 9 Visited client offices and agreed on the terms of a consulting project. Bramble will bill the client, Connor Productions, on the 20th of each month for services performed. Collected $940 cash on account from Milani Brothers. This client was billed in June when Bramble performed the service. 10Explanation / Answer
Answer 1. Journal Entry Date Particulars Dr. Amt. Cr. Amt. 1-Jul Equipment 19,200.00 Cash 3,600.00 Notes Payable 15,600.00 2-Jul Cash 39,000.00 Common Stock 39,000.00 3-Jul Prepaid Insurance 3,000.00 Cash 3,000.00 3-Jul Prepaid Rent 6,200.00 Cash 6,200.00 6-Jul Supplies 3,000.00 Cash 3,000.00 9-Jul No Entry 10-Jul Cash 940.00 Accounts Receivable 940.00 13-Jul Unearned Service Revenue 870.00 Service Revenue 870.00 14-Jul Accounts Payable 310.00 Cash 310.00 16-Jul Cash 9,400.00 Unearned Service Revenue 9,400.00 18-Jul Salaries & Wages Expense 8,600.00 Cash 8,600.00 20-Jul Accounts Receivable 21,800.00 Service Revenue 21,800.00 20-Jul Advertisement Expense 1,700.00 Accounts Payable 1,700.00 23-Jul Unearned Service Revenue 7,800.00 Service Revenue 7,800.00 27-Jul Cash 11,700.00 Accounts Receivable 11,700.00 31-Jul Insurance Expense ($3,000 / 12) 250.00 Prepaid Insurance 250.00 31-Jul Rent Expense ($6,200 / 2) 3,100.00 Prepaid Rent 3,100.00 31-Jul Supplies Expense 1,000.00 Supplies 1,000.00 31-Jul Depreciation Expense 400.00 Accumulated Depreciation - Equipment 400.00 31-Jul Interest Expense ($15,600 X 6% X 1/12) 78.00 Interest Payable 78.00 31-Jul Salaries & Wages Expense 8,600.00 Salaries & Wages Payable 8,600.00 31-Jul Utilities Expense 620.00 Accounts Payable 620.00 31-Jul Income Tax Expense 940.00 Income Tax Payable 940.00 Answer 2. Cash Accounts Receivable Supplies Beg. Bal. 4,080.00 3,600.00 1-Jul Beg. Bal. 940.00 940.00 10-Jul Beg. Bal. 540.00 1,000.00 31-Jul 2-Jul 39,000.00 3,000.00 3-Jul 20-Jul 21,800.00 11,700.00 27-Jul 6-Jul 3,000.00 10-Jul 940.00 6,200.00 3-Jul 16-Jul 9,400.00 3,000.00 6-Jul 27-Jul 11,700.00 310.00 14-Jul 8,600.00 18-Jul End. Bal. 40,410.00 End. Bal. 10,100.00 End. Bal. 2,540.00 Prepaid Insurance Prepaid Rent Equipment Beg. Bal. - 250.00 31-Jul Beg. Bal. - 3,100.00 31-Jul Beg. Bal. - 3-Jul 3,000.00 3-Jul 6,200.00 1-Jul 19,200.00 End. Bal. 2,750.00 End. Bal. 3,100.00 End. Bal. 19,200.00 Accumulated Depreciation - Equipment Accounts Payable Notes Payable Beg. Bal. - Beg. Bal. 310.00 Beg. Bal. - 400.00 31-Jul 14-Jul 310.00 1,700.00 20-Jul 15,600.00 1-Jul 620.00 31-Jul End. Bal. 400.00 End. Bal. 2,320.00 End. Bal. 15,600.00 Interest Payable Income Tax Payable Salaries & Wages Payable Beg. Bal. - Beg. Bal. - 940.00 31-Jul Beg. Bal. - 78.00 31-Jul 8,600.00 31-Jul End. Bal. 78.00 End. Bal. 940.00 End. Bal. 8,600.00 Unearned Service Revenue Common Stock Retained Earnings Beg. Bal. 870.00 Beg. Bal. 2,800.00 Beg. Bal. 1,580.00 13-Jul 870.00 9,400.00 16-Jul 39,000.00 2-Jul 23-Jul 7,800.00 End. Bal. 1,600.00 End. Bal. 41,800.00 End. Bal. 1,580.00 Dividends Service Revenue Supplies Expense Beg. Bal. - 870.00 13-Jul 31-Jul 1,000.00 21,800.00 20-Jul 7,800.00 23-Jul End. Bal. - End. Bal. 30,470.00 End. Bal. 1,000.00 Depreciation Expense Insurance Expense Salaries & Wages Expense Beg. Bal. - Beg. Bal. - Beg. Bal. - 31-Jul 400.00 31-Jul 250.00 18-Jul 8,600.00 31-Jul 8,600.00 End. Bal. 400.00 End. Bal. 250.00 End. Bal. 17,200.00 Advertisement Expense Income Tax Expense Interest Expense Beg. Bal. - Beg. Bal. - Beg. Bal. - 20-Jul 1,700.00 31-Jul 940.00 31-Jul 78.00 End. Bal. 1,700.00 End. Bal. 940.00 End. Bal. 78.00 Rent Expense Utilities Expense Beg. Bal. - Beg. Bal. - 31-Jul 3,100.00 31-Jul 620.00 End. Bal. 3,100.00 End. Bal. 620.00
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