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ACC557 Week 3

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ACC557 Week 3 E4-1 E4-7 E4-11 E4-12 P4-4A P4-5A

E4-1 The trial balance columns of the worksheet for Briscoe Company at June 30, 2008, are as

For the Month Ended June 30, 2008

Cash  2,320
Accounts Receivable  2,440
Supplies  1,880
Accounts Payable  1,120
Unearned revenue 240
Common stock 3,600
Service Revenue  2,400
Salaries expense 560
Miscellaneous Expense  160
 7,360 7,360

Other data:
1. A physical count reveals $300 of supplies on hand.
2. $100 of the unearned revenue is still unearned at month-end.
3. Accrued salaries are $280.

Enter the trial balance on a worksheet and complete the worksheet.

E4-7 Emil Skoda Company had the following adjusted trial balance.

Emil Skoda Company
Adjusted Trial Balance
For the Month Ended June 30, 2008

Cash 3,712
Accounts Receivable 3,904
Supplies 480
Accounts Payable 1,792
Unearned revenue 160
Common stock 5,000
Retained earnings 760
Dividends 300
Service revenue 4,064
Salaries expense 1,344
Miscellaneous expense 256
Supplies Expense 2,228
Salaries payable 448
 12,224 12,224

(a) Prepare closing entries at June 30, 2008.
(b) Prepare a post-closing trial balance.

E4-11 Selected accounts for Nina’s Salon are presented below. All June 30 postings are from
closing entries.

(a) Prepare the closing entries that were made.
(b) Post the closing entries to Income Summary

E4-12 Max Weinberg Company discovered the following errors made in January 2008.
1. A payment of Salaries Expense of $600 was debited to Equipment and credited to Cash,
both for $600.
2. A collection of $1,000 from a client on account was debited to Cash $100 and credited to
Service Revenue $100.
3. The purchase of equipment on account for $980 was debited to Equipment $890 and
credited to Accounts Payable $890.

(a) Correct the errors by reversing the incorrect entry and preparing the correct entry.

(b) Correct the errors without reversing the incorrect entry

P4-4A Disney Amusement Park, Inc. has a fiscal year ending on September 30. Selected data
from the September 30 worksheet are presented below.

For the Year Ended September 30, 2008

(a) Prepare a complete worksheet.
(b) Prepare a classified balance sheet. (Note: $10,000 of the mortgage note payable is due for
payment in the next fiscal year.)
(c) Journalize the adjusting entries using the worksheet as a basis.
(d) Journalize the closing entries using the worksheet as a basis.
(e) Prepare a post-closing trial balance.

P4-5A Laura Eddy opened Eddy’s Carpet Cleaners Inc. on March 1. During March, the following
transactions were completed.

Mar. 1 Issued stock for $10,000 in cash.
1 Purchased used truck for $6,000, paying $3,000 cash and the balance on account.
3 Purchased cleaning supplies for $1,200 on account.
5 Paid $1,200 cash on one-year insurance policy effective March 1.
14 Billed customers $4,800 for cleaning services.
18 Paid $1,500 cash on amount owed on truck and $500 on amount owed on cleaning
20 Paid $1,800 cash for employee salaries.
21 Collected $1,400 cash from customers billed on March 14.
28 Billed customers $2,500 for cleaning services.
31 Paid gas and oil for month on truck $200.
31 Declared and paid a $700 cash dividend.

The chart of accounts for Eddy’s Carpet Cleaners contains the following accounts: No. 101
Cash, No. 112 Accounts Receivable,No. 128 Cleaning Supplies,No. 130 Prepaid Insurance,No.
157 Equipment, No. 158 Accumulated Depreciation—Equipment, No. 201 Accounts Payable,
No. 212 Salaries Payable, No. 311 Common Stock, No. 320 Retained Earnings, No. 332
Dividends, No. 350 Income Summary, No. 400 Service Revenue, No. 633 Gas & Oil Expense,
No. 634 Cleaning Supplies Expense, No. 711 Depreciation Expense, No. 722 Insurance
Expense, and No. 726 Salaries Expense.

(a) Journalize and post the March transactions. Use page J1 for the journal and the three-column
form of account.
(b) Prepare a trial balance at March 31 on a worksheet.
(c) Enter the following adjustments on the worksheet and complete the worksheet.
(1) Earned but unbilled revenue at March 31 was $700.
(2) Depreciation on equipment for the month was $250.
(3) One-twelfth of the insurance expired.
(4) An inventory count shows $400 of cleaning supplies on hand at March 31.
(5) Accrued but unpaid employee salaries were $500.
(d) Prepare the income statement and a retained earnings statement for March and a classified
balance sheet at March 31.
(e) Journalize and post adjusting entries. Use page J2 for the journal.
(f) Journalize and post closing entries and complete the closing process. Use page J3 for the
(g) Prepare a post-closing trial balance at March 31.

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