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pg_0049 - Check(1 Ending Retained Earnings $29,250(2 Pc mar...

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Unformatted text preview: Check (1) Ending Retained Earnings, $29,250 (2) Pc mar balance totals, 570,150 1. Prepare an income statement and a statement ofretained earnings for the year 2009, and a clamified balance sheetas ofDecember 31, 2009. 2. Enter the adjusted trial balance in the first two columns of a six—column table. Use columns three and four for closing entry information and the last two columns for a post—closing trial balance—see the headings below. Insert an Income Summary account as the last row in the trial balance. Adjusted Closing Entries Post-Closing Trial Balance Information Trial Balance Account Title Dr. Cr. Dr. Cr. Dr. Cr. 3. Enter closing entry information in the six—column table and prepare journal entries for them. Analysis Component 4. Assume for this partonly that: :1. None of the 51,6“) insurance expense had expired during the year. Instead, assume it is a prepayment of the next period's insurance protection. b. There are no earned and unpaid wages at the end of the year. (Hint: Reverse the $700 wages payable accrual.) Describe the financial statement changes that would result from these two assumptions. P re b le m 3 -4A Applying the accounting cycle C3 1’4 1’5 1 eXceI n'fl‘lhe.oomMIdFAF26 On April 1, 211m, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the company's first month. April 1 Nozomi invested $32,000 cash and computer equipment worth $26,000 in the business in exchange for its common stock. 2 Rented furnished office Space by paying $1,300 cash for the first month’s (April) rent. 3 Purchased $2,500 of office supplies for cash. 10 Paid $2,500 cash for the premium on a 12-month insurance policy. Coverage begins on April I 1. 14 Paid $2,300 cash for two weeks’ salaries earned by employees. 24 Collected $16,000 cash on commissions from airlines on tickets obtained for customers. 28 Paid another $2,500 cash for two weeks’ salaries earned by employees. 29 Paid $750 cash for minor repairs to the company’s computer. 30 Paid $550 cash for this month’s telephone bill. 30 Paid $1,200 cash for dividends. The company's chart of accounts follows: IOI Cash 405 Commissions Earned I06 Accounts Receivable 6l2 Depreciation Expense—Computer Equip. I24 Office Supplies 622 Salaries Expense I28 Prepaid Insurance 637 Insurance Expense I67 Computer Equipment 640 Rent Expense I68 Accumulated Depreciation—Computer Equip. 650 Office Supplies Expense 209 Salaries Payable 684 Repairs Expense 307 Common Stock 688 Telephone Expense 3 l8 Retained Earnings 90l Income Summary ...
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