Kay's Delivery Service begun operation in 2020 and the owner of the company Karen Taylor has requested the assistance of your group in the preparation of the company's accounts. The company presented the following chart of accounts for use in the recording of its transactions: Cash Service revenue Accounts receivable Salary expense Depreciation expense Supplies Prepaid Insurance Insurance expense Delivery truck Accumulated depreciation Fuel expense Rent expense Accounts payable Supplies expense Salary payable Income summary Unearned service revenue Kay's, Capital Kay's, Drawing During the period January to December 2020 the company completed the following transactions: A. Kay's Delivery Service began operations by receiving $180,000 cash and a truck valued at $250,000. The business gave Kay capital to acquire these assets. B. Paid $19,000 cash for supplies. C. Prepaid insurance, $28,000. D. Performed delivery services for a customer and received $5,500 cash. E. Completed a large delivery job, billed the customer $35,500, and received a promise to collect the $35,500 within three (3) months. F. Paid employees salary, $65,700. G. Received $15,000 cash for performing delivery services. H. Collected $12,000 in advance for delivery service to be performed later. I. Collected $35,500 cash from a customer on account. J. Purchased fuel for the truck, paying $29,800 with a company credit card. (Credit Accounts payable) K. Performed delivery services on account, $4,500. L. Paid office rent, $85,000 for the year. M. Paid $20,800 on account relating to fuel purchased. N. Owner withdrew cash of $15,300. Requirements: 1. Record each transaction in the journal and key each transaction by its letter. Narrations are not required. 2. Post the transaction your recorded in requirement 1 in the T accounts as per the company's accounts as provided. 3. Prepare the unadjusted trail balance for the year ended December 31, 2020, based on the info already presented.
Kay's Delivery Service begun operation in 2020 and the owner of the company Karen Taylor has requested the assistance of your group in the preparation of the company's accounts. The company presented the following chart of accounts for use in the recording of its transactions: Cash Service revenue Accounts receivable Salary expense Depreciation expense Supplies Prepaid Insurance Insurance expense Delivery truck Accumulated depreciation Fuel expense Rent expense Accounts payable Supplies expense Salary payable Income summary Unearned service revenue Kay's, Capital Kay's, Drawing During the period January to December 2020 the company completed the following transactions: A. Kay's Delivery Service began operations by receiving $180,000 cash and a truck valued at $250,000. The business gave Kay capital to acquire these assets. B. Paid $19,000 cash for supplies. C. Prepaid insurance, $28,000. D. Performed delivery services for a customer and received $5,500 cash. E. Completed a large delivery job, billed the customer $35,500, and received a promise to collect the $35,500 within three (3) months. F. Paid employees salary, $65,700. G. Received $15,000 cash for performing delivery services. H. Collected $12,000 in advance for delivery service to be performed later. I. Collected $35,500 cash from a customer on account. J. Purchased fuel for the truck, paying $29,800 with a company credit card. (Credit Accounts payable) K. Performed delivery services on account, $4,500. L. Paid office rent, $85,000 for the year. M. Paid $20,800 on account relating to fuel purchased. N. Owner withdrew cash of $15,300. Requirements: 1. Record each transaction in the journal and key each transaction by its letter. Narrations are not required. 2. Post the transaction your recorded in requirement 1 in the T accounts as per the company's accounts as provided. 3. Prepare the unadjusted trail balance for the year ended December 31, 2020, based on the info already presented.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Transcribed Image Text:Scenario:
Kay's Delivery Service begun operation in 2020 and the owner of the company Karen Taylor has requested the assistance of your
group in the preparation of the company's accounts. The company presented the following chart of accounts for use in the recording
of its transactions:
Cash
Service revenue
Accounts receivable
Salary expense
Supplies
Prepaid Insurance
Delivery truck
Accumulated depreciation
Depreciation expense
Insurance expense
Fuel expense
Rent expense
Accounts payable
Supplies expense
Salary payable
Income summary
Unearned service revenue
Kay's, Capital
Kay's, Drawing
During the period January to December 2020 the company completed the following transactions:
A. Kay's Delivery Service began operations by receiving $180,000 cash and a truck valued at $250,000. The business gave
Kay capital to acquire these assets.
B. Paid $19,000 cash for supplies.
C. Prepaid insurance, $28,000.
D. Performed delivery services for a customer and received $5,500 cash.
E. Completed a large delivery job, billed the customer $35,500, and received a promise to collect the $35,500 within three (3)
months.
F. Paid employees salary, $65,700.
G. Received $15,000 cash for performing delivery services.
H. Collected $12,000 in advance for delivery service to be performed later.
I. Collected $35,500 cash from a customer on account.
J. Purchased fuel for the truck, paying $29,800 with a company credit card. (Credit Accounts payable)
K. Performed delivery services on account, $4,500.
L. Paid office rent, $85,000 for the year.
M. Paid $20,800 on account relating to fuel purchased.
N. Owner withdrew cash of $15,300.
Requirements:
1. Record each transaction in the journal and key each transaction by its letter. Narrations are not required.
2. Post the transaction your recorded in requirement 1 in the T accounts as per the company's accounts as provided.
3. Prepare the unadjusted trail balance for the year ended December 31, 2020, based on the info already presented.
4. The following additional information relates to the company's 2020 financial affairs and was provided in the first week of 2021
and are to be record same as adjusting entries:( Key each transaction by its letter and narrations are not required):
O. Accrued salary expense, $19,500.
P. Depreciation expense, $6,500.
Q. Prepaid insurance expired, $24,000.
R. Supplies on hand, $2,500.
S. Unearned service revenue earned during 2020, $7,000.
5. Use the transactions in requirement 4 to update the affected T accounts.
6. Prepare the company's adjusted trial balance, income statement, statement of owner's equity and classified balance sheet for
2020.
7. Journalize and post the closing entries to their respective T accounts.
8. Prepare the company's post-closing trial balance for 2020.
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