
Concept explainers
Ledger Accounts,
The unadjusted trial balance of Recessive Interiors at January 31, 2019, the end of the year, follows:
Recessive Interiors Unadjusted Trial Balance January 31, 2019 |
||||||
Account No. | Debit Balances | Credit Balances | ||||
Cash | 11 | 13,100 | ||||
Supplies | 13 | 8,000 | ||||
Prepaid Insurance | 14 | 7,500 | ||||
Equipment | 16 | 113,000 | ||||
17 | 12,000 | |||||
Trucks | 18 | 90,000 | ||||
Accumulated Depreciation-Trucks | 19 | 27,100 | ||||
Accounts Payable | 21 | 4,500 | ||||
Jeanne McQuay, Capital | 31 | 126,400 | ||||
Jeanne McQuay, Drawing | 32 | 3,000 | ||||
Service Revenue | 41 | 155,000 | ||||
Wages Expense | 51 | 72,000 | ||||
Rent Expense | 52 | 7,600 | ||||
Truck Expense | 53 | 5,350 | ||||
Miscellaneous Expense | 59 | 5,450 | ||||
325,000 | 325,000 |
The following additional accounts from Recessive Interiors' chart of accounts should be used: Wages Payable, 22; Depreciation Expense-Equipment, 54; Supplies Expense, 55; Depreciation Expense-Trucks, 56; Insurance Expense, 57.
The data needed to determine year-end adjustments are as follows:
- Supplies on hand at January 31 are $2,850.
- Insurance premiums expired during the year are $3,150.
- Depreciation of equipment during the year is $5,250.
- Depreciation of trucks during the year is $4,000.
- Wages accrued but not paid at January 31 are $900.
Use the attached spreadsheet to complete parts 2, 3, and 6. Click on the Spreadsheet icon above to open and save the Excel file to your computer. Your input into the spreadsheet will not be included in your grade in CengageNOW on this problem.
Required:
1. For each account listed in the trial balance, notice that the balance has been entered in the appropriate general ledger account balance column of the spreadsheet. Posting to the general ledger will take place in step 3 and step 6.
2. (Optional) In the attached spreadsheet, notice that the unadjusted trial balance amounts have been entered. Enter the adjusting entries and complete the worksheet.
3. Journalize the adjusting entries on page 26 of the journal. Then post to the appropriate accounts in the general ledger in the attached spreadsheet, inserting balances in the accounts affected.
Journal | PAGE 26 | |||
---|---|---|---|---|
Date | Account | Post. Ref. | Debit | Credit |
a. | ||||
b. | ||||
c. | ||||
d. | ||||
e. | ||||
4. Prepare an adjusted trial balance. If an amount box does not require an entry, leave it blank.
Recessive Interiors Adjusted Trial Balance January 31, 2019 |
||
---|---|---|
Debit Balances | Credit Balances | |
5. Prepare an income statement.
Recessive Interiors Income Statement For the Year Ended January 31, 2019 |
||
---|---|---|
$ | ||
Expenses: | ||
$ | ||
Total expenses | ||
$ |
Prepare a Statement of Owner's Equity (no additional investments were made during the year.)
Recessive Interiors Statement of Owner's Equity For the Year Ended January 31, 2019 |
||
---|---|---|
$ | ||
$ | ||
$ |
Prepare a balance sheet.
Recessive Interiors Balance Sheet January 31, 2019 |
||||||
---|---|---|---|---|---|---|
Assets | Liabilities | |||||
Current assets: | Current liabilities: | |||||
$ | $ | |||||
Total liabilities | $ | |||||
Total current assets | $ | |||||
Property, plant, and equipment: | Owner's Equity | |||||
$ | ||||||
$ | ||||||
$ | ||||||
Total property, plant, and equipment | ||||||
Total assets | $ | Total liabilities and owner's equity | $ |
6. Journalize the closing entries on page 27 of the journal. Then post to the general ledger in the attached spreadsheet. For a compound transaction, if an amount box does not require an entry, leave it blank.
Journal | PAGE 27 | |||
---|---|---|---|---|
Date | Account | Post. Ref. | Debit | Credit |
Close expenses, revenues &income/loss |
||||
Close drawing | ||||
7. Prepare a post-closing trial balance. If an amount box does not require an entry, leave it blank.
Recessive Interiors Post-Closing Trial Balance January 31, 2019 |
||
---|---|---|
Debit Balances | Credit Balances | |
Totals |

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