Kelly pitney began her consulting business, Kelly Consulting, on April 1, 2010. The accounting cylcle for Kelly Consulting for April , including financial statements was illistrated on page 157-168. During May, kelly consulting entered the following transactions:
May 3. Received cash from clients as an advance payment for services to be provided and recorded it as unearned fees, $2,500.
5. Received cash from clients on account, $1,750.
9. Paid cash for a newspaper advertisement, $300.
13. Paid office station company for part of the debt incurred on april 5, $400.
15. Recorded services provided on account for the period May 1-15, $6,100.
16. paid part-time receptionist for two weeks' salary including the amount owed on April 30, $750.
17. Recorded cash from cash clients for fees earned during the period May 1-16, $8,200.
20. Purchased supplies on account, $400
21. Recorded services provided on account for the period May 16-20, $3,900.
25. Recorded cash from cash clients for fees earned for the period May 17-23, $5,100.
27. Recieved cash from clients on account, $9,500.
28. Paid part-time receptionist for two weeks salary, $750.
30. Paid telephone bill for May, $120.
31. Paid electricity bill for May $290.
31. Recorded cash from cash clients for fees earned for the period May 26-31, $3,875.
31. Recorded services provided on account for the remainder of May, $3,200.
31. Kelly withdrew $8,000 for personal use.
Pg. 158 Chart of Accounts:
April 1. The following assets were recieved from Kelly Pitney: Cash, $13,100; Accounts receivable, $3,000; Supplies, $1,400; and office equipment, $12,500. there were no liabilities recieved.
1. Paid three months rent on a lease rental contract, $4,800.
2. Paid the premiums on property and casualty insurance policies, $1,800.
4. Recieved cash from clients as an advance payment for services to be provided and recorded it as unearned fees, $5,000.
5. Purchased additional office equipment on account from Office Station Co., $2,000.
6. Recieved cash from clients on account, $1,800.
10. Paid cash for a newspaper advertisement, $120.
12. paid Office Station Co. for part of the debt incurred on April 5, $1,200.
12. Recorded services provided on account for the period April 1-12, $4,200.
14. Paid part-time receptionist for two weeks' salary, $750.
17. Recorded cash from cash clients for fees earned during the period April 1-16, $6,250.
18. Paid cash for supplies, $800.
20. Recorded services provided on account for the period April 13-20, $2,100.
24. Recorded cash from cash clients for fees earned for the period April 17-24, $3,850.
26. Recieved cash from clients on account, $5,600.
27. Paid part-time receptionist for two weeks' salary, $750.
29. Paid telephone bill for April, $130.
30. paid electricity bill for April, $200.
30. Recorded cash from clients for fees earned for the period April 25-30, $3,050.
30. Recorded services provided on account for the remainder of April, $1,500.
30. kelly withdrew $6,000 for personal use.
Pg. 166 Post-closing trial balance
Debit Credit
cash................................22,100
Accounts receivable.......3,400
Supplies...........................1,350
Prepaid rent......................3,200
Prepaid insurance.............1,500
office equipment...............14,500
Accumualted depreciation.. 330
Accounts payable.............. 800
Salaries Payable.............. 120
Unearned Fees................ 2,500
kelly pitney, Capital.......... 42,300
46,050 46,050
Instructions:
1. The chart of accounts for Kelly Consulting is shown on page 158, and the post-closing trail balance as of April 30, 2010 is shown on page 166. For each account in the post-closing trial balance, enter the balance in the appropriate balance column of a four column account. Date the balances May 1, 2010, and place a check mark in the posting referece column. Journalize each of the May transactions in a two column journal using Kelly Consulting's chart of accounts. (do not insert the account numbers in the journal at this time.)
2. Post the journal to a ledger of four-column accounts.
3. Prepare an unadjusted trail balance
4. At the end of May, the following adjustment data were assembled. Analyze and use these data to complete parts 5 and 6.
a. Insurance expired during May is $300.
b. Supplies on hand on May 31 are $600.
c. Depreciation of office equipment for May is $330.
d. Accrued receptionist salary on May 31 is $240.
e. Rent expired during May is $1,600.
f. Unearned fees on May 31 are $2,000
5. Enter the unadjusted trial balance on an end-of-period spreadsheet (worksheet) and complete the spreadsheet.
6. Journalize and post the adjusting entries.
7.Prepare an adjusted trial balance.
8. Prepare an income statement, a statement of owner's equity, and a balance sheet.
9. Prepare and post the closing entries. (Income summary is account #33 in the chart of accounts.) Indicate closed accounts by inserting a line in both the Balance columns opposite the closing entry.
10. Prepare a post-closing trial balance
Book Used:
Elementary Accounting: Custom for badm 101
by Carl S. Warren/James M. Reeve/ Jonathan E. Duchac.
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