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    4 Completing The Accounting Cycle Part

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    Talion
    1. Green River Computer Consultants recorded transactions during July 2020, including purchasing equipment, receiving owner investments, prepaying insurance and rent, paying supplies and salaries, performing and billing for services, and collecting cash from customers. 2. Adjusting entries were needed for prepaid expenses, supplies used, depreciation, interest on a note, and accrued salaries. 3. Financial statements were prepared using the adjusted trial balance, including an income statement, balance sheet, and statement of owner's equity.

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    4 Completing The Accounting Cycle Part

    Uploaded by

    Talion
    244 views1 page
    1. Green River Computer Consultants recorded transactions during July 2020, including purchasing equipment, receiving owner investments, prepaying insurance and rent, paying supplies and salaries, performing and billing for services, and collecting cash from customers. 2. Adjusting entries were needed for prepaid expenses, supplies used, depreciation, interest on a note, and accrued salaries. 3. Financial statements were prepared using the adjusted trial balance, including an income statement, balance sheet, and statement of owner's equity.

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    4 Completing the Accounting Cycle Part (55)

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    1. Green River Computer Consultants recorded transactions during July 2020, including purchasing equipment, receiving owner investments, prepaying insurance and rent, paying supplies and salaries, performing and billing for services, and collecting cash from customers. 2. Adjusting entries were needed for prepaid expenses, supplies used, depreciation, interest on a note, and accrued salaries. 3. Financial statements were prepared using the adjusted trial balance, including an income statement, balance sheet, and statement of owner's equity.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    244 views1 page

    4 Completing The Accounting Cycle Part

    Uploaded by

    Talion
    1. Green River Computer Consultants recorded transactions during July 2020, including purchasing equipment, receiving owner investments, prepaying insurance and rent, paying supplies and salaries, performing and billing for services, and collecting cash from customers. 2. Adjusting entries were needed for prepaid expenses, supplies used, depreciation, interest on a note, and accrued salaries. 3. Financial statements were prepared using the adjusted trial balance, including an income statement, balance sheet, and statement of owner's equity.

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    of 1

    Comprehensive Accounting Cycle Review 4-55

    c. Post to the ledger accounts. B&B’s chart of accounts includes Prepaid Advertising, Interest Receiv-
    able, Service Revenue, Interest Revenue, Advertising Expense, Depreciation Expense, Supplies
    Expense, Salaries and Wages Expense, and Rent Expense.
    d. Prepare a trial balance at August 31.
    e. Journalize and post adjusting entries.
    f. Prepare an adjusted trial balance. f. Cash $2,020
    g. Prepare an income statement and an owner’s equity statement for August and a classified balance Tot. adj. trial balance $32,580
    sheet at August 31. g. Net loss $530
    h. Journalize and post closing entries and complete the closing process.
    i. Prepare a post-closing trial balance at August 31.

    ACR4.4 Financial Statement At June 30, 2020, the end of its most recent fiscal year, Green River Record and post transaction,
    Computer Consultants’ post-closing trial balance was as follows: adjusting, and closing journal
    entries; prepare adjusted trial
    Debit Credit balance and financial statements.
    Cash $5,230
    Accounts receivable 1,200
    Supplies 690
    Accounts payable $ 400
    Unearned service revenue 1,120
    Owner’s capital 5,600
    $7,120 $7,120

    The company underwent a major expansion in July. New staff was hired and more financing was
    obtained. Green River conducted the following transactions during July 2020, and adjusts its accounts
    monthly.
    July 1 Purchased equipment, paying $4,000 cash and signing a 2-year note payable for $20,000.
    The equipment has a 4-year useful life. The note has a 6% interest rate which is payable on
    the first day of each following month.
    2 Owner invested $50,000 cash in the company.
    3 Paid $3,600 cash for a 12-month insurance policy effective July 1.
    3 Paid the first 2 (July and August 2020) months’ rent for an annual lease of office space for
    $4,000 per month.
    6 Paid $3,800 for supplies.
    9 Visited client offices and agreed on the terms of a consulting project. Green River will bill
    the client, Connor Productions, on the 20th of each month for services performed.
    10 Collected $1,200 cash on account from Milani Brothers. This client was billed in June
    when Green River performed the service.
    13 Performed services for Fitzgerald Enterprises. This client paid $1,120 in advance last
    month. All services relating to this payment are now completed.
    14 Paid $400 cash for a utility bill. This related to June utilities that were accrued at the end of
    June.
    16 Met with a new client, Thunder Bay Technologies. Received $12,000 cash in advance for
    future services to be performed.
    18 Paid semi-monthly salaries for $11,000.
    20 Performed services worth $28,000 on account and billed customers.
    20 Received a bill for $2,200 for advertising services received during July. The amount is not
    due until August 15.
    23 Performed the first phase of the project for Thunder Bay Technologies. Recognized
    $10,000 of revenue from the cash advance received July 16.
    27 Received $15,000 cash from customers billed on July 20.
    Adjustment data:
    1. Adjustment of prepaid insurance.
    2. Adjustment of prepaid rent.
    3. Supplies used, $1,250.
    4. Equipment depreciation, $500 per month.
    5. Accrual of interest on note payable. (Hint: Use the formula from Illustration 3.17 to compute interest.)
    6. Salaries for the second half of July, $11,000, to be paid on August 1.

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