The general ledger of the Karlin Company, a consuling company, at January 1, 201

Question

The general ledger of the Karlin Company, a consuling company, at January 1, 2016 , contained the following account balances: Account Title DebitsCredits 15,000 20,000 Accounts reccivable Accumulated depreciation Salaries payable Common stock Retained carnings 6,000 9,000 40,500 9,500 65.00065.000 Total The following is a summary of the transactions I. 2. 3. 4. 5. 6. 7. Sales of services, $100,000, of which $30,000 was on credit. Collected on accounts receivable, $27,300. Issued shares of common stock in exchange for S10,000 in cash. Paid salaries, $50,000 (of which $9,000 was for salaries payable). Paid miscellancous expenses, $24,000. Purchased equipment for $15,000 in cash. Paid $2,500 in cash dividends to shareholders. Required: 1. Set up the necessary Tasccounts and enter the beginning balances from the tial balance. 2. Prepare a general journal entry for cach of the summary transactions listed above. 3. Post the journal entries to the accounts. 4. Prepare an unadjusted trial balance. 5. Prepare and post adjusting journal cntries. Accrued salaries at year-end amounted to S1,000. for the ycar on the equipment is $2,000 6. Prepare an adjusted trial balance. 7. Prepare an income statement for 2016 and a balance shecet as of December 31, 2016. 8. Prepare and post closing entries. 9. Prepare a post-closing trial balance

Explanation / Answer

Answer for question no.1:

Answer for question no.2:

Answer for question no.3:

Ledgers after posting are as follows:

Answer for question no.4:

Unadjusted trail balance is as follows:

Cash Date Particulars Debit Date Particulars Credit 01-Jan To Balance b/f $30,000.00 Accounts receivable a/c Date Particulars Debit Date Particulars Credit 01-Jan To balance b/f $15,000.00 Total Total Equipment a/c Date Particulars Debit Date Particulars Credit 01-Jan To balance b/f $20,000.00 Accumulated depreciation a/c Date Particulars Debit Date Particulars Credit 01-Jan by balance b/f $6,000.00 Salary expenses a/c Date Particulars Debit Date Particulars Credit Salaries payable a/c Date Particulars Debit Date Particulars Credit 01-Jan by balance b/f $9,000.00 Common stock a/c Date Particulars Debit Date Particulars Credit 01-Jan by balance b/f $40,500.00 Retained earnings Date Particulars Debit Date Particulars Credit 01-Jan By balance b/f $9,500.00 Miscellaneous expenses a/c Date Particulars Debit Date Particulars Credit Service revenue a/c Date Particulars Debit Date Particulars Credit

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