Accounting CycleJournal Entries which are involved to the Business Adjusting Journal EntriesAdjusting Journal EntryDateParticularsRefDebit Credit Jan 30 2020Supplies Expenses40818000 Supplies105 18000Jan 30 2020Depreciation Expenses - Equipment (25000/10)*1/12409208 Accumulated Depreciation - Equipment310 208Jan 30 2020Depreciation Expenses - Furniture and Fixtures (35000/5)*1/12410583 Accumulated Depreciation - Furniture and Fixtures311 583Jan 30 2020Salaries Expenses40625000 Salary Payable407 25000Jan 30 2020Insurance Expenses (20000/3*1)4086667 Prepaid Insurance104 6667Jan 30 2020Unearned Sales Revenue30725000 Sales305 25000Jan 30 2020Bad Debt Expenses (80000*5%)4124000 To Allowance for Doubtful Account420 4000 T- Accounts Cash - 101 DebitCredit Jan 01 2020Jan 15 2020Jan 15 2020Jan 25 2020Jan 30 2020 15000045000250006000035000 Jan 01 2020Jan 01 2020Jan 01 2020Jan 10 2020Jan 15 2020Jan 18 2020Jan 18 2020Jan 20 2020 Jan 21 2020Jan 25 2020Jan 28 2020150002000025000800003000018000100001000035001500025000 Balance63,500 Capital - 301 DebitCredit Jan 1 2020 150,000 Supplies - 105 DebitCredit Jan 01 2020Jan 18 2020 15000 10000 Jan 30 2020 18000 Balance: 7,000 Accounts Payable – 205 DebitCredit Jan 15 2020 30000 Jan 01 2020Jan 01 2020Jan 05 2020 50003500080000 Balance100,000 Rent Expenses – 401 DebitCredit Jan 01 202015000 Prepaid Insurance- 104 DebitCredit Jan 01 2020 20000 Jan 30 2020 6667 Balance13333 Office Equipment – 201 DebitCredit Jan 01 202025000 Furniture and Fixtures – 202 DebitCredit Jan 01 202035000 Inventory - 301 DebitCredit Jan 052020Jan 10 2020 8000080000 Jan 11 2020Jan15 2020Jan 20 2020Jan 25 2020 30000280004500045000 Balance12,000 Accounts Receivable - 102 DebitCredit Jan 11 2020Jan 20 2020 4000065000 Jan 15 2020 25000 Balance80,000 Sales - 305 DebitCredit Jan 11 2020Jan 15 2020Jan 20 2020Jan 25 2020Jan 30 2020 4000045000650006000025000 Cost of goods sold - 302 DebitCredit Jan 11 2020Jan 15 2020Jan 20 2020Jan 25 202030000280004500045000 Advertisement Expenses - 402 DebitCredit Jan 18 202018000 Owner’s Withdrawal - 403 DebitCredit Jan 20 202010000 Telephone Charges - 404 DebitCredit Jan 21 20203500 Electricity Charges - 405 DebitCredit Jan 25 202015000 Salaries Expenses - 406 DebitCredit Jan 28 2020Jan 30 2020 2500025000 Balance50000 Unearned Sales Revenue - 307 DebitCredit Jan 30 2020 25000 Jan 30 2020 35000 Balance10,000 Supplies Expenses – 406 DebitCredit Jan 30 202018000 Depreciation Expenses - Office Equipment DebitCredit Jan 30 2020208 Accumulated Depreciation - Office Equipment DebitCredit Jan 30 2020208 Depreciation Expenses - Furniture and Fixtures DebitCredit Jan 30 2020583 Accumulated Depreciation - Furniture and Fixtures DebitCredit Jan 30 2020583 Salaries Payable DebitCredit Jan 30 202025000 Insurance Expenses DebitCredit Jan 30 2020 6667 Trial BalanceAdjusted Trial BalanceParticularsDebitCreditCash63500 Owner’s Capital 150000Supplies7000 Accounts Payable 100000Rent Expenses15000 Prepaid Insurance13333 Office Equipment25000 Furniture and fixtures35000 Inventory12000 Accounts Receivable80000 Sales 235000Cost of goods sold148000 Advertisement Expenses18000 Owner’s Withdrawal10000 Telephone Charges3500 Electricity Charges15000 Salaries expenses50000 Unearned Sales Revenue 10000Supplies Expenses18000 Depreciation Expenses - Office Equipment208 Accumulated Depreciation - Office Equipment 208Depreciation Expenses - Furniture and Fixtures583 Accumulated Depreciation - Furniture and Fixtures 583Salaries Payable 25000Insurance Expenses6667 Total520,791520,791 Income StatementIncome StatementParticularsDebitCreditSales 235000Less : Expenses Cost of goods sold148000 Advertisement Expenses18000 Rent Expenses15000 Telephone Charges3500 Electricity Charges15000 Salaries expenses50000 Supplies Expenses18000 Depreciation Expenses - Office Equipment208 Depreciation Expenses - Furniture and Fixtures583 Insurance Expenses6667 274,958Net Loss -39,958 Balance SheetBalance SheetParticularsDebitCreditAssets Current Assets Cash63500 Supplies7000 Prepaid Insurance13333 Inventory12000 Accounts Receivable80000 175,833Non Current Assets Office Equipment25000 Less: Accumulated Depreciation - Office Equipment-208 Furniture and fixtures35000 Less: Accumulated Depreciation - Furniture and Fixtures-58359209Total Assets 235,042 Liabilities and Equity Current Liabilities Accounts Payable100000 Unearned Sales Revenue10000 Salaries Payable25000135000Equity Zayed hassan Capital150000 Net Loss-39,958 Owner’s Withdrawal-10000100,042Total 235,042Ratio analysis case: evaluate the firms performance using the ratio analysis and briefly discuss your findings.

Sales = 235,000 Cost of Goods Sold = 148,000 Net Profit or Loss = -39,958 Current Assets = 175,833…

Answered: evaluate the firms performance using…

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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Question

Accounting Cycle

Journal Entries which are involved to the Business

Adjusting Journal Entries

Adjusting Journal Entry
Date	Particulars	Ref	Debit	Credit
Jan 30 2020	Supplies Expenses	408	18000
	Supplies	105		18000
Jan 30 2020	Depreciation Expenses - Equipment (25000/10)*1/12	409	208
	Accumulated Depreciation - Equipment	310		208
Jan 30 2020	Depreciation Expenses - Furniture and Fixtures (35000/5)*1/12	410	583
	Accumulated Depreciation - Furniture and Fixtures	311		583
Jan 30 2020	Salaries Expenses	406	25000
	Salary Payable	407		25000
Jan 30 2020	Insurance Expenses (20000/3*1)	408	6667
	Prepaid Insurance	104		6667
Jan 30 2020	Unearned Sales Revenue	307	25000
	Sales	305		25000
Jan 30 2020	Bad Debt Expenses (80000*5%)	412	4000
	To Allowance for Doubtful Account	420		4000

T- Accounts

Cash - 101
Debit	Credit
Jan 01 2020 Jan 15 2020 Jan 15 2020 Jan 25 2020 Jan 30 2020	150000 45000 25000 60000 35000	Jan 01 2020 Jan 01 2020 Jan 01 2020 Jan 10 2020 Jan 15 2020 Jan 18 2020 Jan 18 2020 Jan 20 2020 Jan 21 2020 Jan 25 2020 Jan 28 2020	15000 20000 25000 80000 30000 18000 10000 10000 3500 15000 25000
Balance	63,500

Capital - 301
Debit	Credit
	Jan 1 2020	150,000

Supplies - 105
Debit	Credit
Jan 01 2020 Jan 18 2020	15000 10000	Jan 30 2020	18000
Balance: 7,000

Accounts Payable – 205
Debit	Credit
Jan 15 2020	30000	Jan 01 2020 Jan 01 2020 Jan 05 2020	5000 35000 80000
		Balance	100,000

Rent Expenses – 401
Debit	Credit
Jan 01 2020	15000

Prepaid Insurance- 104
Debit	Credit
Jan 01 2020	20000	Jan 30 2020	6667
Balance	13333

Office Equipment – 201
Debit	Credit
Jan 01 2020	25000

Furniture and Fixtures – 202
Debit	Credit
Jan 01 2020	35000

Inventory - 301
Debit	Credit
Jan 052020 Jan 10 2020	80000 80000	Jan 11 2020 Jan15 2020 Jan 20 2020 Jan 25 2020	30000 28000 45000 45000
Balance	12,000

Accounts Receivable - 102
Debit	Credit
Jan 11 2020 Jan 20 2020	40000 65000	Jan 15 2020	25000
Balance	80,000

Sales - 305
Debit	Credit
		Jan 11 2020 Jan 15 2020 Jan 20 2020 Jan 25 2020 Jan 30 2020	40000 45000 65000 60000 25000

Cost of goods sold - 302
Debit	Credit
Jan 11 2020 Jan 15 2020 Jan 20 2020 Jan 25 2020	30000 28000 45000 45000

Advertisement Expenses - 402
Debit	Credit
Jan 18 2020	18000

Owner’s Withdrawal - 403
Debit	Credit
Jan 20 2020	10000

Telephone Charges - 404
Debit	Credit
Jan 21 2020	3500

Electricity Charges - 405
Debit	Credit
Jan 25 2020	15000

Salaries Expenses - 406
Debit	Credit
Jan 28 2020 Jan 30 2020	25000 25000
Balance	50000

Unearned Sales Revenue - 307
Debit	Credit
Jan 30 2020	25000	Jan 30 2020	35000
		Balance	10,000

Supplies Expenses – 406
Debit	Credit
Jan 30 2020	18000

Depreciation Expenses - Office Equipment
Debit	Credit
Jan 30 2020	208

Accumulated Depreciation - Office Equipment
Debit	Credit
		Jan 30 2020	208

Depreciation Expenses - Furniture and Fixtures
Debit	Credit
Jan 30 2020	583

Accumulated Depreciation - Furniture and Fixtures
Debit	Credit
		Jan 30 2020	583

Salaries Payable
Debit	Credit
		Jan 30 2020	25000

Insurance Expenses
Debit	Credit
Jan 30 2020	6667

Trial Balance

Adjusted Trial Balance
Particulars	Debit	Credit
Cash	63500
Owner’s Capital		150000
Supplies	7000
Accounts Payable		100000
Rent Expenses	15000
Prepaid Insurance	13333
Office Equipment	25000
Furniture and fixtures	35000
Inventory	12000
Accounts Receivable	80000
Sales		235000
Cost of goods sold	148000
Advertisement Expenses	18000
Owner’s Withdrawal	10000
Telephone Charges	3500
Electricity Charges	15000
Salaries expenses	50000
Unearned Sales Revenue		10000
Supplies Expenses	18000
Depreciation Expenses - Office Equipment	208
Accumulated Depreciation - Office Equipment		208
Depreciation Expenses - Furniture and Fixtures	583
Accumulated Depreciation - Furniture and Fixtures		583
Salaries Payable		25000
Insurance Expenses	6667
Total	520,791	520,791

Income Statement

Income Statement
Particulars	Debit	Credit
Sales		235000
Less : Expenses
Cost of goods sold	148000
Advertisement Expenses	18000
Rent Expenses	15000
Telephone Charges	3500
Electricity Charges	15000
Salaries expenses	50000
Supplies Expenses	18000
Depreciation Expenses - Office Equipment	208
Depreciation Expenses - Furniture and Fixtures	583
Insurance Expenses	6667	274,958
Net Loss		-39,958

Balance Sheet

Balance Sheet
Particulars	Debit	Credit
Assets
Current Assets
Cash	63500
Supplies	7000
Prepaid Insurance	13333
Inventory	12000
Accounts Receivable	80000	175,833
Non Current Assets
Office Equipment	25000
Less: Accumulated Depreciation - Office Equipment	-208
Furniture and fixtures	35000
Less: Accumulated Depreciation - Furniture and Fixtures	-583	59209
Total Assets		235,042

Liabilities and Equity
Current Liabilities
Accounts Payable	100000
Unearned Sales Revenue	10000
Salaries Payable	25000	135000
Equity
Zayed hassan Capital	150000
Net Loss	-39,958
Owner’s Withdrawal	-10000	100,042
Total		235,042

Ratio analysis case:

evaluate the firms performance using the ratio analysis and briefly discuss your findings.

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