On October 1, 2018 Abdullah formed Accounting Consulting Co. to provide accounting services. The following are September 30th, 2019balances from its ledger (Saudi Riyal):Cash 50,000, Accounts Receivable 20,000 , Office Supplies 5,000 , Office Equipment 15,000, Accumulated Depreciation – Office Equipment 1,500 , Accounts Payable 8,500 , Owner capital 80,000During the last quarter of the year 2019, the following transactions occurred:Oct 1, 2019hired 2 accountants for a weekly salary of S.R 2,000 each, payable monthly.Oct 1, 2019Paid S.R 24,000 to Alnabil Realtors for 6 month’s rent,paid in advance.Oct 1, 2019Paid insurance for one year for S.R12,000Oct10, 2019Conducted accounting services for customers, S.R 15,000, and only one-third of the amount was received.Oct 20, 2019Purchased a new computer for S.R 3,500 cash.Oct 31, 2019Paid employee’s salaries of S.R 40,000.Nov 15, 2019Signed a contract regarding Alburj’ bookkeeping workand received S.R 100,000 cash from client as an advance payment for services to be completed at the end of January 2020Nov28Received cash from clients on account, S.R 8000.Nov30, 2019Paid employee’s salaries of S.R 35,000.December 2, 2019Received cash S.R 40,000, furniture S.R 20,000, car S.R 80,000 as an additional investment from the owner.December 31, 2019Withdrew S.R 3000 by the owner for personal useDecember 31, 2019Paid telephone bill and electricity bill for the period, S.R 1500, SR. 3000, respectively. In addition to data mentioned on above transactions, Other data to be used in adjustment:- Office equipment depreciates annually on basis of 10% of its cost.- The December salaries, S.R 25,000, have not been paid or recorded.The office performs adjusting entries quarterly. Closing entries are performed annually on December 31.Instructions:a. Journalize and post quarter transactions.b. Prepare December 31st, 2019 trail balancec. Use the work sheet.d. Journalize and post the necessary adjustments on December 31st, 2019.e. Prepare an adjusted trail balance at December 31st, 2019.f. Prepare the following financial statements:1. Income statement.2. Owner’s equity statement.3. Classified balance sheetg. Journalize and post-closing entries at December 31st, 2019.h. Prepare post-closing trail balance at December 31st, 2019.

Final Accounts Journal entries are used to record transactions. It then posted into ledger…

Answered: a. Journalize and post quarter…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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On October 1, 2018 Abdullah formed Accounting Consulting Co. to provide accounting services. The following are September 30th, 2019balances from its ledger (Saudi Riyal):

Cash 50,000, Accounts Receivable 20,000 , Office Supplies 5,000 , Office Equipment 15,000, Accumulated Depreciation – Office Equipment 1,500 , Accounts Payable 8,500 , Owner capital 80,000

During the last quarter of the year 2019, the following transactions occurred:

Oct 1, 2019	hired 2 accountants for a weekly salary of S.R 2,000 each, payable monthly.
Oct 1, 2019	Paid S.R 24,000 to Alnabil Realtors for 6 month’s rent,paid in advance.
Oct 1, 2019	Paid insurance for one year for S.R12,000
Oct10, 2019	Conducted accounting services for customers, S.R 15,000, and only one-third of the amount was received.
Oct 20, 2019	Purchased a new computer for S.R 3,500 cash.
Oct 31, 2019	Paid employee’s salaries of S.R 40,000.
Nov 15, 2019	Signed a contract regarding Alburj’ bookkeeping workand received S.R 100,000 cash from client as an advance payment for services to be completed at the end of January 2020
Nov28	Received cash from clients on account, S.R 8000.
Nov30, 2019	Paid employee’s salaries of S.R 35,000.
December 2, 2019	Received cash S.R 40,000, furniture S.R 20,000, car S.R 80,000 as an additional investment from the owner.
December 31, 2019	Withdrew S.R 3000 by the owner for personal use
December 31, 2019	Paid telephone bill and electricity bill for the period, S.R 1500, SR. 3000, respectively.

In addition to data mentioned on above transactions, Other data to be used in adjustment:

- Office equipment depreciates annually on basis of 10% of its cost.

- The December salaries, S.R 25,000, have not been paid or recorded.

The office performs adjusting entries quarterly. Closing entries are performed annually on December 31.

Instructions:

a. Journalize and post quarter transactions.

b. Prepare December 31st, 2019 trail balance

c. Use the work sheet.

d. Journalize and post the necessary adjustments on December 31st, 2019.

e. Prepare an adjusted trail balance at December 31st, 2019.

f. Prepare the following financial statements:

1. Income statement.

2. Owner’s equity statement.

3. Classified balance sheet

g. Journalize and post-closing entries at December 31st, 2019.

h. Prepare post-closing trail balance at December 31st, 2019.

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