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Complete accounting cycle For the past several years, Jeff Horton has operated a part-time consulting business from his home. As of April 1, 2016, Jeff decided to move to rented quarters and to operate the business, which was to be known as Rosebud Consulting, on a full-time basis. Rosebud Consulting entered into the following transactions during April: Apr. 1. The following assets were received from Jeff Horton: cash, $20,000; accounts receivable, $14,700; supplies, $3,300; and office equipment, $12,000. There were no liabilities received. 1. Paid three months’ rent on a lease rental contract, $6,000. 2. Paid the premiums on property and casualty insurance policies, $4,200. 4. Received cash from clients as an advance payment for services to be provided and recorded it as unearned fees, $9,400. 5. Purchased additional office equipment on account from Smith Office Supply Co., $8,000. 6. Received cash from clients on account, $11,700. 10. Paid cash for a newspaper advertisement, $350. 12. Paid Smith Office Supply Co. for part of the debt incurred on April 5, $6,400. 12. Recorded services provided on account for the period April 1–12, $21,900. 14. Paid receptionist for two weeks' salary, $1,650. Record the following transactions on Page 2 of the journal: 17. Recorded cash from cash clients for fees earned during the period April 1–16, $6,600. 18. Paid cash for supplies, $725. 20. Recorded services provided on account for the period April 13–20, $16,800. 24. Recorded cash from cash clients for fees earned for the period April 17–24, $4,450. 26. Received cash from clients on account, $26,500. 27. Paid receptionist for two weeks’ salary, $1,650. 29. Paid telephone bill for April, $540. 30. Paid electricity bill for April, $760. 30. Recorded cash from cash clients for fees earned for the period April 25–30, $5,160. 30. Recorded services provided on account for the remainder of April, $2,590. 30. Jeff withdrew $18,000 for personal use. Instructions 1. Journalize each transaction in a two-column journal starting on Page 1 , referring to the following chart of accounts in selecting the accounts to be debited and credited. (Do not insert the account numbers in the journal at this time.) 11 Cash 12 Accounts Receivable 14 Supplies 15 Prepaid Rent 16 Prepaid Insurance 18 Office Equipment 19 Accumulated Depreciation 21 Accounts Payable 22 Salaries Payable 23 Unearned Fees 31 Jeff Horton, Capital 32 Jeff Horton, Drawing 41 Fees Earned 51 Salary Expense 52 Supplies Expense 53 Rent Expense 54 Depreciation Expense 55 Insurance Expense 59 Miscellaneous Expense 2. Post the journal to a ledger of four-column accounts. 3. Prepare an un adjusted trial balance. 4. At the end of April, the following adjustment data were assembled. Analyze and use these data to complete parts (5) and (6). a. Insurance expired during April is $350. b. Supplies on hand o n April 30 are $1,225. c. Depreciation of office equipment for April is $400. d. Accrued receptionist salary on April 30 is $275. e. Rent expired during April is $2,000. f. Unearned fees on April 30 are $2,350. 5. (Optional) Enter the unadjusted trial balance on an end-of-period spreadsheet and complete the spreadsheet. 6. Journalize and post the adjusting entries. Record the adjusting entries on Page 3 of the journal. 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. Record the closing entries on Page 4 of the journal. (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.

BuyFind

Accounting (Text Only)

26th Edition
Carl Warren + 2 others
Publisher: Cengage Learning
ISBN: 9781285743615
BuyFind

Accounting (Text Only)

26th Edition
Carl Warren + 2 others
Publisher: Cengage Learning
ISBN: 9781285743615

Solutions

Chapter
Section
Chapter 4, Problem 4.5BPR
Textbook Problem

Complete accounting cycle

For the past several years, Jeff Horton has operated a part-time consulting business from his home. As of April 1, 2016, Jeff decided to move to rented quarters and to operate the business, which was to be known as Rosebud Consulting, on a full-time basis. Rosebud Consulting entered into the following transactions during April:

Apr. 1. The following assets were received from Jeff Horton: cash, $20,000; accounts receivable, $14,700; supplies, $3,300; and office equipment, $12,000. There were no liabilities received.

1. Paid three months’ rent on a lease rental contract, $6,000.

2. Paid the premiums on property and casualty insurance policies, $4,200.

4. Received cash from clients as an advance payment for services to be provided and recorded it as unearned fees, $9,400.

5. Purchased additional office equipment on account from Smith Office Supply Co., $8,000.

6. Received cash from clients on account, $11,700.

10. Paid cash for a newspaper advertisement, $350.

12. Paid Smith Office Supply Co. for part of the debt incurred on April 5, $6,400.

12. Recorded services provided on account for the period April 1–12, $21,900.

14. Paid receptionist for two weeks' salary, $1,650.

Record the following transactions on Page 2 of the journal:

17. Recorded cash from cash clients for fees earned during the period April 1–16, $6,600.

18. Paid cash for supplies, $725.

20. Recorded services provided on account for the period April 13–20, $16,800.

24. Recorded cash from cash clients for fees earned for the period April 17–24, $4,450.

26. Received cash from clients on account, $26,500.

27. Paid receptionist for two weeks’ salary, $1,650.

29. Paid telephone bill for April, $540.

30. Paid electricity bill for April, $760.

30. Recorded cash from cash clients for fees earned for the period April 25–30, $5,160.

30. Recorded services provided on account for the remainder of April, $2,590.

30. Jeff withdrew $18,000 for personal use.

Instructions

1. Journalize each transaction in a two-column journal starting on Page 1, referring to the following chart of accounts in selecting the accounts to be debited and credited. (Do not insert the account numbers in the journal at this time.)

11 Cash

12 Accounts Receivable

14 Supplies

15 Prepaid Rent

16 Prepaid Insurance

18 Office Equipment

19 Accumulated Depreciation

21 Accounts Payable

22 Salaries Payable

23 Unearned Fees

31 Jeff Horton, Capital

32 Jeff Horton, Drawing

41 Fees Earned

51 Salary Expense

52 Supplies Expense

53 Rent Expense

54 Depreciation Expense

55 Insurance Expense

59 Miscellaneous Expense

2. Post the journal to a ledger of four-column accounts.

3. Prepare an un adjusted trial balance.

4. At the end of April, the following adjustment data were assembled. Analyze and use these data to complete parts (5) and (6).

a. Insurance expired during April is $350.

b. Supplies on hand o n April 30 are $1,225.

c. Depreciation of office equipment for April is $400.

d. Accrued receptionist salary on April 30 is $275.

e. Rent expired during April is $2,000.

f. Unearned fees on April 30 are $2,350.

5. (Optional) Enter the unadjusted trial balance on an end-of-period spreadsheet and complete the spreadsheet.

6. Journalize and post the adjusting entries. Record the adjusting entries on Page 3 of the journal.

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. Record the closing entries on Page 4 of the journal. (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.

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Chapter 4 Solutions

Accounting (Text Only)
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Ch. 4 - Flow of accounts into financial statements The...Ch. 4 - Flow of accounts into financial statements The...Ch. 4 - Statement of owner's equity Marcie Davies owns and...Ch. 4 - Statement of owners equity Blake Knudson owns and...Ch. 4 - Classified balance sheet The following accounts...Ch. 4 - Classified balance sheet The following accounts...Ch. 4 - Closing entries After the accounts have been...Ch. 4 - Closing entries After the accounts have been...Ch. 4 - Accounting cycle From the following list of steps...Ch. 4 - Accounting cycle From the following list of steps...Ch. 4 - Working capital and current ratio Balance sheet...Ch. 4 - Working capital and current ratio Balance sheet...Ch. 4 - Flow of accounts into financial statements The...Ch. 4 - Classifying accounts Balances for each of the...Ch. 4 - Financial statements from the end-of-period...Ch. 4 - Financial statements from the end-of-period...Ch. 4 - Income statement The following account balances...Ch. 4 - Income statement; net loss The following revenue...Ch. 4 - Income statement FedEx Corporation had the...Ch. 4 - Statement of owner's equity Apex Systems Co....Ch. 4 - Statement of owners equity; net loss Selected...Ch. 4 - Classifying assets Identify each of the following...Ch. 4 - Balance sheet classification At the balance sheet...Ch. 4 - Balance sheet Optimum Weight Loss Co. offers...Ch. 4 - Balance sheet List the errors you find in the...Ch. 4 - Identifying accounts to be closed From the list...Ch. 4 - Closing entries Prior to its closing, Income...Ch. 4 - Closing entries with net income After all revenue...Ch. 4 - Closing entries with net loss Mira Services Co....Ch. 4 - Identifying permanent accounts Which of the...Ch. 4 - Post-closing trial balance An accountant prepared...Ch. 4 - Steps in the accounting cycle Rearrange the...Ch. 4 - Working capital and current ratio The following...Ch. 4 - Working capital and current ratio The following...Ch. 4 - Completing an end-of-period spreadsheet List (a)...Ch. 4 - Adjustment data on an end-of-period spreadsheet...Ch. 4 - Appendix Completing an end-of-period spreadsheet...Ch. 4 - Appendix Completing an end-of-period spreadsheet...Ch. 4 - Appendix Adjustment data on an end-of-period...Ch. 4 - Appendix Completing an end-of-period spreadsheet...Ch. 4 - Financial statements and closing entries Lamp...Ch. 4 - Financial statements and closing entries Finders...Ch. 4 - T accounts, adjusting entries, financial...Ch. 4 - Ledger accounts, adjusting entries, financial...Ch. 4 - Complete accounting cycle For the past several...Ch. 4 - Financial statements and closing entries Last...Ch. 4 - Financial statements and closing entries The...Ch. 4 - T accounts, adjusting entries, financial...Ch. 4 - Ledger accounts, adjusting entries, financial...Ch. 4 - Complete accounting cycle For the past several...Ch. 4 - The unadjusted trial balance of PS Music as of...Ch. 4 - Kelly Pitney began her consulting business, Kelly...Ch. 4 - Ethics and professional conduct in business...Ch. 4 - Financial statements The following is an excerpt...Ch. 4 - Financial statements Assume that you recently...

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