Answered: Please prepare a full trial balance –…

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

Please prepare a full trial balance – Trial Balance, Adjustments, Adjusted Trial Balance, Income Statement, Balance Sheet, and Statement of Owner’s Equity, as well the individual Balance Sheet, Income Statement, and Statement of Owners Equity. Include any journal entries necessary for this assignment. Use T accounts if you find them helpful.

1
2
4
5
6
Trial Balance
Adjustments
Adjusted Trial Balance
Income Statement
Balance Sheet
7
Debit
Credit
Debit
Credit
Debit
Credit
Debit
Credit
Debit
Credit
8
9
10
11
12 Cash
13 Accounts Receivable
14 Supplies
15 Prepaid Insurance
16 Office Equipment
17 Accum Deprec
18 Accounts Payable
19 C. Mason, Capital
20 C. Mason, Drawing
21 Revenue
22 Depreciation
23 Office Expense
24 Rent Expense
25 Insurance
26 Repairs
27 Wages
28 Supplies
29 Travel Expense
30 Utilities Expense
31 Miscellaneous Expense
32
33
34
35
36
37
38
39
40
41
42
Worksheet
Bal Sheet
Inc Stmt
Stmt OE
Genl Journal

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Expert Solution

Step 1

Calculation of Unadjusted Trail Balance for the given information of one month period September 1, 2020 as follows:

Date	Account Tittle	Dr. ($)	Cr. ($)
	Cash	22,305
	Equipment (5 year property)	40,000
	Accumulated Depreciation		4,000
	Accounts payables		4,335
	Capital		53,970
	Total	62,305	62,305

Adjusting Journal Entries:

Date	Account Tittle	Dr. ($)	Cr. ($)
a)	Accounts Receivables Dr.	55,375
	Sales Cr.		55,375
b)	Cash A/c Dr.	12,000
	Accounts Rec. Cr.		12,000
c)	Prepaid Supplies A/c Dr.	12,200
	Cash Cr.		12,200
d)	Acc. Payable Dr.	4,335
	Cash Cr.		4,335
e)	Prepaid Insurance Dr.	12,000
	Cash Cr.		12,000
30 Sep, 2020	Insurance Expenses Dr.	1,000
	Prepaid Insurance Cr.		1,000
f)	C Mason Capital Dr.	5,500
	Drawings Cr.		5,500
	Drawings Dr.	5,500
	Cash Cr.		5,500
g)	Rent Expenses Dr.	3,500
	Repairs Dr.	105
	Wages Dr.	3,000
	Travel Expense Dr.	4,200
	Utilities Dr.	150
	Miscellaneous Expense dr.	750
	Cash Cr.		11,705
h)	payroll Expenses Dr.	4,484
	FICA tax payable- social security@6.2% Cr.		278
	FICA tax Payable - Medicare Tax@1.45% Cr.		65
	Federal Income tax withheld (given) Cr.		1,855
	Wages and Salaries Payable Cr.		2,286
	Payroll taxes expenses Dr.	343
	FICA tax payable- social security@6.2%		278
	FICA tax Payable - Medicare Tax@1.45%		65

Adjusted Trail Balance as on 30 Sep, 2020 as follows:

Date	Account Tittle	Dr. ($)	Cr. ($)
	Cash ($22,305+$12,000-$12,200-$4,335-$12,000-$11,705-$5,500)		11,435
	Accounts Receivable ($55,375 - $12,000)	$43,375
	Prepaid supplies A/c	12,200
	Prepaid Insurance ($12,000 -$11000)	11,000
	Equipment (5 year property)	40,000
	Accumulated Depreciation		4,000
	Taxes payable ($278+$65+$1,855+$278+$65)		2,541
	Salaries Payable		2,286
	C Mason, Capital		53,970
	C Mason, Drawings	5,500
	Sales		55,375
	Rent Expenses	3,500
	Repairs Expense	105
	Wages Expense	3,000
	Travel Expense	4,200
	Insurance Expense	1,000
	Utilities Expense	150
	Miscellaneous Expense	750
	Payroll tax expenses	343
	Payroll expenses	4484
	Total	129,607	129,607

Income Statement for the month of September 30, 2020

Particulars	($)	($)
Sales		55,375
Expenses :
Rent Expenses	3,500
Repairs Expense	105
Wages Expense	3,000
Travel Expense	4,200
Utilities Expense	150
Insurance expenses	1,000
Miscellaneous Expense	750
Payroll tax expenses	343
Payroll expenses	4484	17,532
Net Income		37,843

Balance Sheet as on Sep 30, 2020

Cash ($22,305+$12,000-$12,200-$4,335-$12,000-$11,705-$5,500)	(11,435)
Accounts Receivable ($55,375 - $12,000)	$43,375
Prepaid supplies A/c	12,200
Prepaid Insurance ($12,000 - $11,000)	11,000
Total Current Assets	55,140	55,140
Non Current Assets
Office Equipment	40,000
Less: accumulated Deprecation	(4,000)	36,000
Total Assets		91,140
Current liabilities
Taxes payable ($278+$65+$1,855+$278+$65)	2,541
Salaries Payable	2,286
Total current liabilities	4,827	4,827
Equity and Liabilities
C Manson, Capital	53,970
Less: Drawings	(5,500)
Add : net Income	37,843	86,313
Total Equity and liabilities		91,140

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