On December 1, Jim Walker began an auto repair shop, Walker's Quality Automotive. The following transactions occurred during December:
Requirements
1. Prepare the journal entries, and post to the T-accounts.
2. Prepare an unadjusted trial balance.
3. Prepare the adjusting entries, and post to the T-accounts.
4. Prepare an adjusted trial balance.
5. Complete the worksheet for the month ended December 31, 2016.
6. Prepare the income statement, the statement of owner's equity, and the classified balance sheet in report form.
7. Prepare the closing entries, and post to the T-accounts.
8. Prepare a post-closing trial balance.
More info
Dec. 1 Walker contributed $68,000 cash to the business in exchange for capital.
1 Purchased $12,000 of equipment paying cash.
1 Paid $5,850 for a nine-month insurance policy starting on December 1.
9 Paid $28,000 cash to purchase land to be used in operations.
10 Purchased office supplies on account, $1,500.
19 Borrowed $10,000 from the bank for business use. Walker signed a note payable to the bank in the name of the business. The note is due in five years.
22 Paid $1,500 for advertising expenses.
26 Paid $300 on account.
28 The business received a bill for utilities to be paid in January, $21
31 Revenues earned during the month included $17,000 cash and $2,600 on account.
31 Paid employees' salaries $3,600 and building rent $1,100. Record as a compound entry.
31 The business received $1,400 for auto screening services to be performed next month.
31 Walker withdrew cash of $3,000.
More info
a. Office Supplies used during the month, $800.
b. Depreciation for the month, $200.
c. One month insurance has expired.
d. Accrued Interest Expense, $80.
