On May 5, 2013, Gina Ennabeortiz
started a carpet cleaning business called Ennabeortiz Family Carpet Cleaning.
She completed the following transactions during the month:
a. Ginainvested $16,500
cash and a small truck with a value of $8,000 to start her business.
b. Prepaid $3,500 cash
for 12 months’ rent on a small office.
c. Purchased office
supplies for cash, $575.
d. Purchased equipment
on account, $4,000.
e. Received cash for
services performed, $3,350.
f. Performed services on
credit, $2,350.
g. Purchased truck
supplies on account, $125.
h. Received $15,350 cash
in advance of providing cleaning services to a customer.
i. Paid $2,500 cash for
the premium on a 6-month insurance policy.
j. Paid salary of
employee, $1,550.
k. Purchased $2,500 of
additional equipment by paying $400 cash and signing a long-term note payable
for $2,100.
l. Paid for repairs to
truck, $225.
m. Received $1,350 for
the services performed in transaction f.
n. Paid utilities, $315.
o. Completed cleaning
services and immediately collected $10,500.
p. Paid creditor $675 on
the purchase in transaction d.
q. Provided $2,000 of
cleaning services from transaction h.
r. Gina withdrew cash
for personal use, $2,775.
s. Paid $5,000 cash for
advertisements on the local television station during May.
Required:
1. Prepare general
journal entries to record these transactions (use the account titles listed in
part 2).
2. Open a set of T
accounts with the following titles: Cash (101), Accounts Receivable (106);
Office Supplies (124); Truck Supplies(128); Equipment (131); Prepaid Rent
(140); Prepaid Insurance (150); Truck (163); Accounts Payable (201); Notes
Payable (202); Unearned Cleaning Revenue (203); GinaEnnabeortiz, Capital (301);
GinaEnnabeortiz, Drawing (302); Cleaning Revenue (403); Salaries Expense (620);
Truck Expense (630); Utilities Expense (640) and Advertising Expense (650).
Post journal entries from Part 1 to the T accounts and calculate the account
balance for each account.
3. Prepare a trial
balance as of the end of this month’s operations.
4. Using the trial
balance created above, prepare an income statement, statement of owner’s equity
and a balance sheet for the month ended May 31st
TUTORIAL
PREVIEW
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Part 1
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a.
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Cash
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101
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16,500
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Truck
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163
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8,000
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GinaEnnabeortiz,
Capital
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301
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24,500
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Owner invested cash and equipment.
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b.
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Prepaid Rent
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140
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3,500
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Cash
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101
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3,500
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Prepaid twelve months’ rent.
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File name: GinaEnnabeortiz.xls File
type: XLS Price: $20
