On April 1, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the company’s first month. April 1 Nozomi invested $32,000 cash and computer equipment worth $35,000 in the company in exchange for common stock. April 2 The company rented furnished office space by paying $2,900 cash for the first month’s (April) rent. April 3 The company purchased $1,800 of office supplies for cash. April 10 The company paid $2,600 cash for the premium on a 12-month insurance policy. Coverage begins on April 11. April 14 The company paid $1,500 cash for two weeks' salaries earned by employees. April 24 The company collected $17,000 cash for commissions revenue. April 28 The company paid $1,500 cash for two weeks' salaries earned by employees. April 29 The company paid $250 cash for minor repairs to the company's computer. April 30 The company paid $1,300 cash for this month's telephone bill. April 30 The company paid $1,500 cash in dividends. The company's chart of accounts follows: 101 Cash 405 Commissions Revenue 106 Accounts Receivable 612 Depreciation Expense—Computer Equipment 124 Office Supplies 622 Salaries Expense 128 Prepaid Insurance 637 Insurance Expense 167 Computer Equipment 640 Rent Expense 168 Accumulated Depreciation—Computer Equipment 650 Office Supplies Expense 209 Salaries Payable 684 Repairs Expense 307 Common Stock 688 Telephone Expense 318 Retained Earnings 901 Income Summary 319 Dividends Use the following information: Prepaid insurance of $144 has expired this month. At the end of the month, $700 of office supplies are still available. This month’s depreciation on the computer equipment is $400. Employees earned $340 of unpaid and unrecorded salaries as of month-end. The company earned $2,100 of commissions that are not yet billed at month-end. Required: 1. & 2. Prepare journal entries to record the transactions for April and post them to the ledger accounts in Requirement 6b. The company records prepaid and unearned items in balance sheet accounts. 3. Using account balances from Requirement 6b, prepare an unadjusted trial balance as of April 30. 4. Journalize the adjusting entries for the month and prepare the adjusted trial balance. 5a. Prepare the income statement for the month of April 30. 5b. Prepare the statement of retained earnings for the month of April 30. 5c. Prepare the balance sheet at April 30. 6a. Prepare journal entries to close the temporary accounts and then post to Requirement 6b. 6b. Post the journal entries to the ledger. 7. Prepare a post-closing trial balance.

On April 1, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the company’s first month. April 1 Nozomi invested $32,000 cash and computer equipment worth $35,000 in the company in exchange for common stock. April 2 The company rented furnished office space by paying $2,900 cash for the first month’s (April) rent. April 3 The company purchased $1,800 of office supplies for cash. April 10 The company paid $2,600 cash for the premium on a 12-month insurance policy. Coverage begins on April 11. April 14 The company paid $1,500 cash for two weeks' salaries earned by employees. April 24 The company collected $17,000 cash for commissions revenue. April 28 The company paid $1,500 cash for two weeks' salaries earned by employees. April 29 The company paid $250 cash for minor repairs to the company's computer. April 30 The company paid $1,300 cash for this month's telephone bill. April 30 The company paid $1,500 cash in dividends. The company's chart of accounts follows: 101 Cash 405 Commissions Revenue 106 Accounts Receivable 612 Depreciation Expense—Computer Equipment 124 Office Supplies 622 Salaries Expense 128 Prepaid Insurance 637 Insurance Expense 167 Computer Equipment 640 Rent Expense 168 Accumulated Depreciation—Computer Equipment 650 Office Supplies Expense 209 Salaries Payable 684 Repairs Expense 307 Common Stock 688 Telephone Expense 318 Retained Earnings 901 Income Summary 319 Dividends Use the following information: Prepaid insurance of $144 has expired this month. At the end of the month, $700 of office supplies are still available. This month’s depreciation on the computer equipment is $400. Employees earned $340 of unpaid and unrecorded salaries as of month-end. The company earned $2,100 of commissions that are not yet billed at month-end. Required: 1. & 2. Prepare journal entries to record the transactions for April and post them to the ledger accounts in Requirement 6b. The company records prepaid and unearned items in balance sheet accounts. 3. Using account balances from Requirement 6b, prepare an unadjusted trial balance as of April 30. 4. Journalize the adjusting entries for the month and prepare the adjusted trial balance. 5a. Prepare the income statement for the month of April 30. 5b. Prepare the statement of retained earnings for the month of April 30. 5c. Prepare the balance sheet at April 30. 6a. Prepare journal entries to close the temporary accounts and then post to Requirement 6b. 6b. Post the journal entries to the ledger. 7. Prepare a post-closing trial balance.

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter10: Accounting For Sales And Cash Receipts

Section: Chapter Questions

Problem 7SEB: JOURNALIZING SALES RETURNS AND ALLOWANCES Enter the following transactions starting on page 60 of a...

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April 1	Nozomi invested $32,000 cash and computer equipment worth $35,000 in the company in exchange for common stock.
April 2	The company rented furnished office space by paying $2,900 cash for the first month’s (April) rent.
April 3	The company purchased $1,800 of office supplies for cash.
April 10	The company paid $2,600 cash for the premium on a 12-month insurance policy. Coverage begins on April 11.
April 14	The company paid $1,500 cash for two weeks' salaries earned by employees.
April 24	The company collected $17,000 cash for commissions revenue.
April 28	The company paid $1,500 cash for two weeks' salaries earned by employees.
April 29	The company paid $250 cash for minor repairs to the company's computer.
April 30	The company paid $1,300 cash for this month's telephone bill.
April 30	The company paid $1,500 cash in dividends.

Required:

1. & 2. Prepare journal entries to record the transactions for April and post them to the ledger accounts in Requirement 6b. The company records prepaid and unearned items in balance sheet accounts.

3. Using account balances from Requirement 6b, prepare an unadjusted trial balance as of April 30.

4. Journalize the adjusting entries for the month and prepare the adjusted trial balance.

5a. Prepare the income statement for the month of April 30.

5b. Prepare the statement of retained earnings for the month of April 30.

5c. Prepare the balance sheet at April 30.

6a. Prepare journal entries to close the temporary accounts and then post to Requirement 6b.

6b. Post the journal entries to the ledger.

7. Prepare a post-closing trial balance.

Complete this question by entering your answers in the tabs below.
Req 1 and 2 Req 3
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1
Req 4 Adj
Entries
Journal entry worksheet
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Date
April 01
3
Req 4 Adj
Trial Bal
Prepare journal entries to record the transactions for April and post them to the ledger accounts in Requirement 6b. The company
records prepaid and unearned items in balance sheet accounts.
Note: Enter debits before credits.
4
5
Req 5A
6
General Journal
Req 5B
7
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Nozomi invested $32,000 cash and computer equipment worth $35,000 in the
company in exchange for common stock.
Req 5C
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Debit
10
Req 6A
Credit
Req 6B GL
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Req 7

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101	Cash	405	Commissions Revenue
106	Accounts Receivable	612	Depreciation Expense—Computer Equipment
124	Office Supplies	622	Salaries Expense
128	Prepaid Insurance	637	Insurance Expense
167	Computer Equipment	640	Rent Expense
168	Accumulated Depreciation—Computer Equipment	650	Office Supplies Expense
209	Salaries Payable	684	Repairs Expense
307	Common Stock	688	Telephone Expense
318	Retained Earnings	901	Income Summary
319	Dividends