1. Create journal entries to record each of February\'s transactions. 2. Post on
ID: 2582734 • Letter: 1
Question
1. Create journal entries to record each of February's transactions.
2. Post onto ledger accounts.
3. Prepare unadjusted trial balance.
4. Prepare adjusted journal entires.
5. Prepare an adjusted trial balance.
6. Prepare in good form the following finanical statements for the year ending in Feb. 28, 2017.
7. Prepare closing entries.
8. Prepare a post closing trial balance.
The "xx" (Ex: $1,9xx) just refers to the number as "$1,900".The "xx" = 00
Excellence Assured Business Executive Coaching and Motivational Speakers, Inc. Transactions for February 2017 February 1 The business received cash of $19,000. The corporation issued common stock to the stockholders February Paid $3,600 for 2 years of insurance February 1 Received $1,500 from a client for 3 months of service February 2 The company signed a note payable for $26,200 from the bank, due in one year with 12% annual interest. February 5 Paid $24,000 for equipment. February 6 Purchased supplies on account, $1,1xx. February 15 Paid employee's salaries $2,3xx Summary transactions for the month of February: February 28 Received $8,6xx from customers for services rendered. February 28 Performed services for customers on account $4,650 February 28 Collected cash from customers on account, S1,9xx. February 28 Paid S9xx of the accounts payable February 28 Paid the following cash expenses: (1) Advertising, $8xx; (2) Rent, $2,2xx. 5) Post cach transaction in the ledger accounts. See illustrations throughout the text chapters. 6) Prepare an unadjusted trial balance. Refer to an example located on page 114 7) Prepare adjusting journal entries. Besides the information provided for adjusting entries, review all information provided for any other adjusting entries that may be needed. See examples throughout chapter Excellence Assured Business Executive Coaching and Motivational Speakers, Inc. Transactions for February 2017 Adjusting entries: February 28 Received a S5xx bill for utilities that will be paid in March (record payable in accounts payable). February 28 Accrued employee's salaries $2,3xx (to be paid on March 1). February 28 Additional adjusting entries hints (1) An inventory of supplies indicates there is a remaining balance of S5xx. (2) You will need to create another account for interest payable, a current liability (3) The formula to calculate interest expense and payable is principal x interest x time (26,200 x.12x 1/12) (4) Remember to review the accounting policies for detail on depreciation. All depreciation expense will be recorded in depreciation expense and the corresponding accumulated depreciation accounts (5) In order to calculate income tax expense, you will need to calculate incomeExplanation / Answer
JOURNAL ENTRY
journal
Date
Particulars
Debit
Credit
Feb 1
CASH A/C DR
19000
TO COMMON STOCK A/C
19000
FEB 1
INSURANCE EXPENSE A/C DR
3600
TO CASH A/C
3600
FEB 1
CASH A/C DR
1500
TO ADVANCEVRECEIPT A/C
1500
FEB 2
CASH A/C DR
26200
TO NOTES PAYABLE A/C
26200
FEB 5
EQUIPMENT A/C DR
24000
TO CASH A/C
24000
FEB 6
PURCHASE A/C DR
1100
TO ACCOUNTS PAYABLE A/C
1100
FEB 15
SALARIES A/C DR
2300
TO CASH A/C
2300
FEB 28
CASH A/C DR
8600
TO CUSTOMER SERVICE REVENUE A/C
8600
FEB 28
ACCOUNT RECEIVABLE A/C DR
4650
TO CUSTOMER SERVICE REVENUE A/C
4650
FEB 28
CASH A/C DR
1900
TO ACCOUNT RECEIVABLE A/C
1900
FEB 28
ACCOUNTS PAYABLE A/C DR
900
CASH A/C
900
FEB 28
ADVERTAISING EXPENSE A/C DR
8000
RENT EXPENSE A/C DR
2200
TO CASH A/C
10,200
LEDGER
CASH A/C
DATE
PARTICULARS
AMOUNT
DATE
PARTICULARS
AMOUNT
FEB 1
COMMON STOCK
19000
FEB 1
INSURANCE
3600
FEB 1
ADVANCE RECEPT
1500
EQUIPMENT
24000
FEB 2
NOTES PAYABLE
26200
FEB 15
SALARIES
2300
FEB 28
CUSTOMER SERVICE
8600
FEB 28
PAYABLES
900
FEB 28
ACCOUNT RECEIVABLE
1900
FEB 28
ADVETAISEMET
8000
RENT EXPENCE
2200
BALANCE C/D
16200
TOTAL
57500
TOTAL
57500
INSURANCE A/C
DATE
PARTICULARS
AMOUNT
DATE
PARTICULARS
AMOUNT
FEB 1
CASH A/C
3600
BALANCE C/D
3600
TOTAL
3600
TOTAL
3600
COMMON STOCK A/C
DATE
PARTICULARS
AMOUNT
DATE
PARTICULARS
AMOUNT
CASH
19000
BALANCE C/D
19000
TOTAL
19000
TOTAL
19000
ACCOUNTS PAYABLE A/C
DATE
PARTICULARS
AMOUNT
DATE
PARTICULARS
AMOUNT
FEB 28
CASH
900
FEB 6
PURCHASE A/C
1100
BALANCE C/D
200
TOTAL
1100
TOTAL
1100
CUSTOMER SERVICE RENUE A/C
DATE
PARTICULARS
AMOUNT
DATE
PARTICULARS
AMOUNT
FEB 28
CASH A/C
8600
FEB 28
ACCOUNT RECEIVABLE ACCOUNT
4650
BALANCE C/D
13250
TOTAL
13250
TOTAL
13250
SALARIES A/C
DATE
PARTICULARS
AMOUNT
DATE
PARTICULARS
AMOUNT
FEB 15
CASH A/C
2300
BALANCE C/D
2300
TOTAL
2300
TOTAL
2300
EQUIPMENT ACCOUNT
DATE
PARTICULARS
AMOUNT
DATE
PARTICULARS
AMOUNT
CASH A/C
24000
BALANCE C/D
24000
TOTAL
24000
TOTAL
24000
TRIAL BALANCE
TRIALBALANCE
NAME OF ACCOUNT
DEBIT
CREDIT
CASH ACCOUNT
16200
COMMON STOCK
19000
INSURANCE
3600
ADVANCE RECEIPT
1500
NOTES PAYABLE
26200
EQUPMENT
24000
PURCHASE
1100
SALARIES
2300
ACCOUNTS PAYABLE
200
ACCOUNTS RECEIVABLE
2750
CUSTOMERSERVISE REVENUE ACCOUNT
13250
ADVERTAISEMENT ACCOUNT
8000
RENT EXPENCE ACCOUNT
2200
TOTAL
60150
60150
ADJUSTING ENTRY
Journal
Date
Particulars
Debit
Credit
FEB 28
UTILITIES A/C DR
5000
TO ACCOUN TS PAYABLE A/C
5000
FEB 28
SALARIES A/C DR
2300
SALARY PAYABLE A/C
2300
FEB 28
INTEREST EXPENSE ACCOUNT DR
262
TO INTEREST PAYABLES A/C
262
(26200*12%*1/12)
FEB 28
DEPRECIATION EXPENSE A/C DR
200
TO ACCUMULATED DEPRECIATION A/C
200
(24000/10*1/12)
INSURANCE PREPAID A/C DR
3450
TO INSURANCE EXPENCE A/C
3450
11712
11712
ADJUSTED TRIL BALANCE
TRIALBALANCE
NAME OF ACCOUNT
DEBIT
CREDIT
CASH ACCOUNT
16200
COMMON STOCK
19000
INSURANCE
150
ADVANCE RECEIPT
1000
NOTES PAYABLE
26200
EQUPMENT
24000
PURCHASE
1100
SALARIES
4600
ACCOUNTS PAYABLE
5200
ACCOUNTS RECEIVABLE
2750
CUSTOMERSERVISE REVENUE ACCOUNT
13750
ADVERTAISEMENT ACCOUNT
8000
RENT EXPENCE ACCOUNT
2200
UTILITIES
5000
SALARY PAYABLE
2300
INTREST EXPENCE A/C
262
INTEREST PAYABLE A/C
262
DEPRECIATION EXPENCE A/C
200
ACCUMULATED DEPRECIATION A/C
200
PREPAID ISURANCE
3450
TOTAL
67912
67912
IN
journal
Date
Particulars
Debit
Credit
Feb 1
CASH A/C DR
19000
TO COMMON STOCK A/C
19000
FEB 1
INSURANCE EXPENSE A/C DR
3600
TO CASH A/C
3600
FEB 1
CASH A/C DR
1500
TO ADVANCEVRECEIPT A/C
1500
FEB 2
CASH A/C DR
26200
TO NOTES PAYABLE A/C
26200
FEB 5
EQUIPMENT A/C DR
24000
TO CASH A/C
24000
FEB 6
PURCHASE A/C DR
1100
TO ACCOUNTS PAYABLE A/C
1100
FEB 15
SALARIES A/C DR
2300
TO CASH A/C
2300
FEB 28
CASH A/C DR
8600
TO CUSTOMER SERVICE REVENUE A/C
8600
FEB 28
ACCOUNT RECEIVABLE A/C DR
4650
TO CUSTOMER SERVICE REVENUE A/C
4650
FEB 28
CASH A/C DR
1900
TO ACCOUNT RECEIVABLE A/C
1900
FEB 28
ACCOUNTS PAYABLE A/C DR
900
CASH A/C
900
FEB 28
ADVERTAISING EXPENSE A/C DR
8000
RENT EXPENSE A/C DR
2200
TO CASH A/C
10,200
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