On November 1, 2014. the following were the account balances of Ratio Equipment
ID: 2749465 • Letter: O
Question
On November 1, 2014. the following were the account balances of Ratio Equipment Repair. During November the following summary transactions were completed Paid $1.220 for salaries due employees, of which $600 is for November ; $620 is for October salaries payable. Received $1,800 cash from customers in payment of account. Received $3.700 cash for services performed in November. Purchased store equipment on account $3.600. Purchased supplies on account $1.300. Paid creditors $2.500 of accounts payable due. Paid November rent $480. Paid salaries $1.000. Performed services on account worth $900 and billed customers. Received $750 from customers for services to be provided in the future. Supplies on hand are valued at $1.100. I Accrued salaries payable are $480 t Depreciation for the month is $250. Services were performed to satisfy $500 of unearned serv ice revenue. Enter the November 1 balances in the ledger accounts. (Use T-accounts.) Journalize the November transactions. Post to the ledger accounts. Use Service Revenue, Depreciation Expense, Supplies Expense, Salaries and Wages Expense, and Rent Expense. Prepare a trial balance at November 30. Journalize and post adjusting entries. Prepare an adjusted trial balance. Prepare an income statement and a retained earnings statement for November and a classified balance sheet at November 30.Explanation / Answer
a) Cash A/c 1-Nov-14 To opening balance 2790 8-Nov-14 By Salary and Wages Expense 600 By Salary and Wages Payable 620 10-Nov-14 To Accounts Receivable 1800 20-Nov-14 By Account Payable 2500 12-Nov-14 To Service Revenue 3700 22-Nov-14 By rent Expense 480 29-Nov-14 To Unearned Service Revenue 750 25-Nov-14 By Salary Expense 1000 30-Nov-14 By closing Balance 3840 9040 9040 Account Receivable 1-Nov-14 To opening balance 2910 10-Nov-14 By Cash 1800 27-Nov-14 To Service Revenue 900 30-Nov-14 By closing Balance 2010 3810 3810 Supplies 1-Nov-14 To opening balance 1120 30-Nov-14 By closing Balance 2420 17-Nov-14 To Account Payable 1300 2420 2420 30-Nov-14 By Retained Earnings 1320 30-Nov-14 By adjusted closing Balance 1100 2420 2420 Equipment 1-Nov-14 To opening balance 10000 30-Nov-14 By closing Balance 13600 15-Nov-14 To Account Payable 3600 13600 13600 Accumulated Depriciation 30-Nov-14 To closing Balance 500 1-Nov-14 By opening balance 500 500 500 30-Nov-14 To adjusted closing Balance 750 30-Nov-14 By Depriciation 250 750 750 Accounts Payable 20-Nov-14 To Cash 2500 1-Nov-14 By opening balance 2300 30-Nov-14 To closing Balance 4700 15-Nov-14 By Equipment 3600 17-Nov-14 By Supplies 1300 7200 7200 Unearned Service Revenue 30-Nov-14 To closing Balance 1150 1-Nov-14 By opening balance 400 29-Nov-14 By Cash 750 1150 1150 30-Nov-14 To Service Revenue 500 30-Nov-14 By adjusted closing Balance 650 Salaries and Wages Payable 8-Nov-14 To Cash 620 1-Nov-14 By opening balance 620 620 620 30-Nov-14 To adjusted closing Balance 480 30-Nov-14 By Salaries and Wages Expense 480 Common Stock 30-Nov-14 To closing Balance 10000 1-Nov-14 By opening balance 10000 10000 10000 Retained Earnings 30-Nov-14 To Salaries and Wages Expense 1600 1-Nov-14 By opening balance 3000 30-Nov-14 To rent Expenses 480 30-Nov-14 By Service Revenue 4600 30-Nov-14 To closing Balance 5520 7600 7600 30-Nov-14 To Supplies 1320 30-Nov-14 By Service Revenue 500 30-Nov-14 To Salaries and Wages Expense 480 30-Nov-14 To Depriciation Expense 250 30-Nov-14 To adjusted closing Balance 3970 6020 Salaries and Wages Expense 8-Nov-14 To Cash 600 30-Nov-14 By retained earnings 1600 25-Nov-14 To Cash 1000 1600 1600 30-Nov-14 To Salaries and Wages Payable 480 30-Nov-14 By retained earnings 480 Service Revenue 30-Nov-14 To retained earnings 4600 12-Nov-14 By Cash 3700 27-Nov-14 By Account Receivable 900 4600 4600 30-Nov-14 To retained earnings 500 30-Nov-14 By Unearned Service Revenue 500 Rent Expense 22-Nov-14 To Cash 480 30-Nov-14 By retained earnings 480 480 480 Depriciation Expense 30-Nov-14 To Accumulated Depriciation 250 By Retained Earnings 250 b) Journal entries of November 8-Nov-14 Salaries and Wages Expense Dr 600 Salaries and Wages Expense Payable Dr 620 Cash Cr 1220 (To record salary payment for October and November) 10-Nov-14 Cash Dr 1800 Account Receivable Cr 1800 ( Rto record cash received from customer) 12-Nov-14 Cash Dr 3700 Service Revenue Cr 3700 ( To record cash receiuved for sevice of November) 15-Nov-14 Equipment Dr 3600 Account Payable Cr 3600 ( to record purchase of store equipment) 17-Nov-14 Supplies Dr 1300 Account Payable Cr 1300 ( to record purchase of store equipment) 20-Nov-14 Account Payable Dr 2500 Cash Cr 2500 ( To record payment to creditor) 22-Nov-14 Rent Expense Dr 480 Cash Cr 480 (To record payment of November rent) 25-Nov-14 Salaries and Wages Expense Dr 1000 Cash Cr 1000 ( to record salary payment) 27-Nov-14 Account receivable Dr 900 Service Revenue Cr 900 ( To record services rendered for November) 29-Nov-14 Cash Dr 750 Unearned Service Revenue Cr 750 ( To record cash received for unearned sevice of November) d) Trial Balance as on30th November 2014 Amount Account Dr Cr Cash A/c 3840 Account receivable 2010 Account Payable 4700 Supplies 2420 Equipment 13600 Accumulated Depriciation 500 Unearned Service Revenue 1150 Salaries and Wages Payable 0 Common Stock 10000 Retained Earnings 5520 21870 21870 e) Adjusting Entries 30-Nov-14 Retained Earnings Dr 1320 Supplies Cr 1320 (To record closing entry of supplies) 30-Nov-14 Salaries and Wages Expense Dr 480 Salaries and Wages Expense Payable Cr 480 ( To recoird salary accrual) 30-Nov-14 Depreciation Expense Dr 250 Accumulated Depriciation Cr 250 ( To record depriciation for the year) 30-Nov-14 Unearned Service Revenue Dr 500 Service Revenue Cr 500 ( To record Service rendered) Adjusted Trial Balance as on 30th November 2014 Amount Account Dr Cr Cash A/c 3840 Account receivable 2010 Account Payable 4700 Supplies 1100 Equipment 13600 Accumulated Depriciation 750 Unearned Service Revenue 650 Salaries and Wages Payable 480 Common Stock 10000 Retained Earnings 3970 20550 20550 Income Statement Service Revenue 5100 Less: Salaries and WagesExoense 2080 Rent Expense 480 Depriciation 250 Supplies 1320 Net Income ( transferred to Retained earnings) 970 Retyained Earnings Statement oprning Bal;ance 3000 Add: transferred from Income Statement 970 Closing Balance 3970 Balance Sheet Debit Credit Cash A/c 3840 Account Payable 4700 Account receivable 2010 Accumulated Depriciation 750 Supplies 1100 Unearned Service Revenue 650 Equipment 13600 Salaries and Wages Payable 480 Common Stock 10000 Retained Earnings 3970 20550 20550
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