The general ledger of Red Storm Cleaners at January 1, 2012, includes the follow
ID: 2418842 • Letter: T
Question
The general ledger of Red Storm Cleaners at January 1, 2012, includes the following account balances
Pay $1,300 cash dividends to stockholders.
I need to record service revenue, the collection of fees on account, issurance of common stock, payment of salaries, repairs and maintenance expense, purchase of equipment, cash divends paid
prepare an adjust trail balance
Record the adjustment of salaries, depreciation expense, adjustment for supplies used
prepare an adjust trail balance
Prepare the Income statement for the year ended December 31, 2012
Prepare the Classified balance sheet for the year ended December 31, 2012
Record the entry to close the revenue accounts,the entry to close the expense accounts, the entry to close the dividends accoun
Accounts Debits Credits Cash $ 16,700 Accounts receivable 7,800 Supplies 3,000 Equipment 10,900 Accumulated depreciation $ 1,100 Salaries payable 4,200 Common stock 13,000 Retained earnings 20,100 Totals $ 38,400 $ 38,400
Explanation / Answer
Journal Entries and The adjustment of salaries, depreciation expense, adjustment for supplies used:
a. cash Dr.$48000
Accounts recievable Dr.$13000
To service revenue $61000
b. cash Dr,$10000
To accounts receivable $10000
c. cash Dr.$5000
To common stock $5000
d. salary Expense Dr.$19000
Salaries payable Dr.$4200
To cash $23200
(adjustment entry)
e. Repair and maintenance Dr.$11600
To cash $11600
f. Equipment Dr.$8600
To cash $8600
1. Depreciation Expense Dr.$860
To Accumulative Depreciation $860
( Adjustment entry :assume 10% depreciation on $8600 for equipment)
g. Dividend Dr.$1300
To cash $1300
2. supplies expense Dr.$3000
To supplies $3000
(adjusment entry :- assume that all the supply in 1.january,2012 is consumed)
Adjust trail balance:
Accounts Debit Credit
cash(16700+48000 + 10000 +5000 -23200 - 11600 - 8600 - 1300) 35000
Accounts receivable(7800+13000 - 10000) 10800
supplies(3000 - 3000) 0
supplies expenses 3000
equipment(10900+86000) 19500
repair and maintenance 11600
accumulated depreciation(1100 + 860) 1960
Depreciation Expense 860
salarie payable (4200 - 4200) 0
salaries expense 19000
service revenue 61000
common stock (13000+ 5000) 18000
dividend 1300
retained earning - 20100
Total $101060 $101060
Income statement for the year ended December 31, 2012:
service revenue 61000
less: depreciation 860
repair and maintenance 11600
supplies expense 3000
salaries expense 19000 (34460)
net profit $26540
Retained earning statement:
opening balance $20100
add: net profit 26540
less : dividend (1300)
Ending balance $45340
Classified balance sheet for the year ended December 31, 2012
Assets
cash 35000
Accounts receivable 10800
equipment 19500
Total assets $65300
Total liabilities and equity
accumulated depreciation 1960
Equity
common stock 18000
retained earning 45340
Total liability and equity $65300
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