On April 1, 2015, Jiro Nozomi created a new travel agency, Adventure Travel. The

Question

On April 1, 2015, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the company's first month. April 1 Nozomi invested $30,000 cash and computer equipment worth $20,000 in the company in exchange for common stock. 2 The company rented furnished office space by paying $1,800 cash for the first month's (April) rent. 3 The company purchased $1,000 of office supplies for cash. 10 The company paid $2,400 cash for the premium on a 12-month insurance policy. Coverage begins on April 11. 14 The company paid $1,600 cash for two weeks' salaries earned by employees. 24 The company collected $8,000 cash on commissions from airlines on tickets obtained for customers. 28 The company paid $1,600 cash for two weeks' salaries earned by employees. 29 The company paid $350 cash for minor repairs to the company's computer. 30 The company paid $750 cash for this month's telephone bill. 30 The company paid $1,500 cash in dividends. The company's chart of accounts follows: 101 Cash 106 Accounts Receivable 124 Office Supplies 128 Prepaid Insurance 167 Computer Equipment 168 Accumulated Depreciation–Computer Equip. 209 Salaries Payable 307 Common Stock 318 Retained Earnings 319 Dividends 405 Commissions Earned 612 Depreciation Expense–Computer Equip. 622 Salaries Expense 637 Insurance Expense 640 Rent Expense 650 Office Supplies Expense 684 Repairs Expense 688 Telephone Expense 901 Income Summary

Explanation / Answer

Ledger accounts are as prepared below:

Cash Particulars Amount Particulars Amount Apr-01 30,000 Apr-02 1,800 Apr-24 8,000 Apr-03 1,000 Apr-10 2,400 Apr-14 1,600 Apr-28 1,600 Apr-29 350 Apr-30 750 Apr-30 1,500 38,000 11,000 Apr-30 27,000 Computer Equipment Particulars Amount Particulars Amount Apr-01 20,000 20,000 0 Apr-30 20,000 Account Receivable Particulars Amount Particulars Amount Apr-30 1,750 1,750 0 Apr-30 1,750 Office supplies Particulars Amount Particulars Amount Apr-03 1,000 Apr-30 400 1,000 400 Apr-30 600 Salaries Expense Particulars Amount Particulars Amount Apr-14 1,600 Income summary 3,620 Apr-28 1,600 Apr-30 420 3,620 3,620 0 Commissions earned Particulars Amount Particulars Amount Income summary 9,750 Apr-24 8,000 Apr-30 1,750 9,750 9,750 Repairs Expense Particulars Amount Particulars Amount Apr-29 350 Income summary 350 350 350 0 Prepaid Insurance Particulars Amount Particulars Amount Apr-10 2,400 Apr-30 133 2,400 133 2,267 Telephone Expense Particulars Amount Particulars Amount Apr-30 750 Income summary 750 750 750 0 Rent Expense Particulars Amount Particulars Amount Apr-02 1,800 Income summary 1,800 1,800 1,800 0 Depreciation Expense Particulars Amount Particulars Amount Apr-30 500 Income Summary 500 500 500 0 Accumulated dep Particulars Amount Particulars Amount Apr-30 500 0 500 Closing 500 Office Supplies Expense Particulars Amount Particulars Amount Apr-30 400 Income Summary 400 400 400 0 Salaries Payable Particulars Amount Particulars Amount Apr-30 420 0 420 Closing 420 Capital Stock Particulars Amount Particulars Amount Apr-01 50,000 0 50,000 50,000 Insurance Expense Particulars Amount Particulars Amount Apr-30 133 Income Summary 133 133 133 0 Dividends Particulars Amount Particulars Amount Apr-30 1,500 Retained earnings 1,500 1,500 1,500 0 Income summary Particulars Amount Particulars Amount Apr-30 3,620 Apr-30 9,750 350 750 1,800 500 400 133 Retained earning 2,197 9,750 9,750 Retained Earnings Particulars Amount Particulars Amount Apr-30 1,500 Apr-30 2,197 1,500 2,197 Closing 697

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