On August 1, 2012, Ken Wade created a new house sitting agency, Wade’s Watchdog
Service. The following transactions occurred during the company’s first month:
Aug. 1 Wade invested $15,000 cash and computer equipment worth $2,500.
Rented furnished office space by paying $800 cash for the first month’s rent.
Purchased $350 of office supplies for cash.
Paid $4,800 cash for the premium on a 12-month insurance policy. Coverage
begins on August 6.
14 Paid $2,200 cash for two weeks’ salaries earned by employees.
24 Collected $5,000 cash for house sitting services provided to customers.
28 Paid another $2,200 cash for two weeks’salaries earned by employees..
29 Paid this month’s $150 telephone bill in cash.
31 Paid $500 cash to repair the company’s computer.
31 Wade withdrew $750 cash from the business for personal use.
The company’s chart of accounts included the following:
2
3
3
101 Cash
106 Accounts Receivable
124 Office Supplies
128 Prepaid Insurance
167 Computer Equipment
168 Accum. Depr. — Computer Equip.
209 Salaries Payable
301 K. Wade, Capital
302 K. Wade, Withdrawals
WRITE THIS ESSAY FOR ME
Tell us about your assignment and we will find the best writer for your paper.
Get Help Now!405 Service Fees 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
Required
1. Use the T-account format to set up each account listed in its chart of accounts.
2. Prepare journal entries to record the transactions for August and post them to the Taccounts. The company records prepaid and unearned items in balance sheet accounts.
3. Prepare an unadjusted trial balance as of August 31.
4. Use the following information to journalize and post adjusting entries for the month:
a. One-half of one month’s insurance coverage has expired.
b. At the end of the month, $60 of office supplies are still available
c. This month’s depreciation on the computer equipment is $200.
d. Employees earned $350 of unpaid and unrecorded salaries as of month-end..
e. The company earned $4,720 of fees that are not yet billed at month-end.
5. Prepare the income statement, the statement of owner’s equity for August, and the
balance sheet at August 31, 2008.
6. Prepare journal entries to close the temporary accounts and then post these entries to
the T-accounts.
7. Prepare a post-closing trial balance.
Introducing our Online Essay Writing Services Agency, where you can confidently place orders for a wide range of academic assignments. Our reputable homework writing company specializes in crafting essays, term papers, research papers, capstone projects, movie reviews, presentations, annotated bibliographies, reaction papers, research proposals, discussions, and various other assignments. Rest assured, our content is guaranteed to be 100% original, as every piece is meticulously written from scratch. Say goodbye to concerns about plagiarism and trust us to deliver authentic and high-quality work.
WRITE MY ESSAY NOW
