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b. Prepare a before-closing trial balance. MARY'S DESIGNS Before-Closing Trial Balance December 31, Year 1 Account Titles Debit Credit

b. Prepare a before-closing trial balance. MARY'S DESIGNS Before-Closing Trial Balance December 31, Year 1 Account Titles Debit Credit

FINANCIAL ACCOUNTING
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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The following accounting events apply to Mary's Designs for Year 1: Asset Source Transactions 1. Began operations by acquiring $16,000 of cash from the issue of common stock. 2. Performed services and collected cash of $900. 3. Collected $4,900 of cash in advance for services to be provided over the next 12 months. 4. Provided $12,200 of services on account. 5. Purchased supplies of $470 on account. Asset Exchange Transactions 6. Purchased $4,200 of land for cash. 7. Collected $7100 of cash from accounts receivable. 8. Purchased $420 of supplies with cash. 9. Paid $3,700 for one year's rent in advance. Asset Use Transactions 10. Paid $2,800 cash for salaries of employees. 11. Paid a cash dividend of $1,900 to the stockholders. 12. Paid off $470 of the accounts payable with cash. Claims Exchange Transactions 13. Placed an advertisement in the local newspaper for $150 on account. 14. Incurred utility expense of $115 on account. Adjusting Entries 15. Recognized $3,675 of revenue for performing services. The collection of cash for these services occurred in a prior transaction. (See Event 3.) 16. Recorded $1,480 of accrued salary expense at the end of Year 1. 17. Recorded supplies expense. Had $90 of supplies on hand at the end of the accounting period. 18. Recognized three months of expense for prepaid rent that had been used up during the accounting period.
Transcribed Image Text:The following accounting events apply to Mary's Designs for Year 1: Asset Source Transactions 1. Began operations by acquiring $16,000 of cash from the issue of common stock. 2. Performed services and collected cash of $900. 3. Collected $4,900 of cash in advance for services to be provided over the next 12 months. 4. Provided $12,200 of services on account. 5. Purchased supplies of $470 on account. Asset Exchange Transactions 6. Purchased $4,200 of land for cash. 7. Collected $7100 of cash from accounts receivable. 8. Purchased $420 of supplies with cash. 9. Paid $3,700 for one year's rent in advance. Asset Use Transactions 10. Paid $2,800 cash for salaries of employees. 11. Paid a cash dividend of $1,900 to the stockholders. 12. Paid off $470 of the accounts payable with cash. Claims Exchange Transactions 13. Placed an advertisement in the local newspaper for $150 on account. 14. Incurred utility expense of $115 on account. Adjusting Entries 15. Recognized $3,675 of revenue for performing services. The collection of cash for these services occurred in a prior transaction. (See Event 3.) 16. Recorded $1,480 of accrued salary expense at the end of Year 1. 17. Recorded supplies expense. Had $90 of supplies on hand at the end of the accounting period. 18. Recognized three months of expense for prepaid rent that had been used up during the accounting period.
b. Prepare a before-closing trial balance. MARY'S DESIGNS Before-Closing Trial Balance December 31, Year 1 Account Titles Debit Credit Total 0 $
Transcribed Image Text:b. Prepare a before-closing trial balance. MARY'S DESIGNS Before-Closing Trial Balance December 31, Year 1 Account Titles Debit Credit Total 0 $
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