Prepare a journal entry for each transaction.              Post the transaction to T-account.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
icon
Concept explainers
Question

The Naseeb Company began operations on August 1, 2018. The following transactions occur during the month of August.                                                                 

Aug-1  Owners invest $50,000 cash in the corporation in exchange for 5,000 shares of common

stock.

Aug-1  On the first day of August, $6,000 rent on a building is paid for the months of August

and September.

Aug-1  $30,000 is borrowed from a local bank, and a note payable is signed.

Aug-3 Equipment is purchased for $20,000 cash.

Aug-5 Naseeb Inc purchases, for $35,000 on account, an estimated 6-month supplies from Hero Supply.

Aug-16 $20,000 cash is loaned to another company, evidenced by a note receivable.

Aug-20 Company Receives $30,000 in cash and bills Kinley company $15,000 for services of

              $45,000 performed in month of August.

Aug-25 $8,000 is collected on account from customers.

Aug-26 $20,000 is paid on account to Hero supply.

Aug-31 Salaries of $7,000 are paid to employees for August.

Aug-31 A bill for $2,000 is received from the local utility company for the month of August.

Aug-31 The Corporation pays its shareholders a cash dividend of $1,000.

Required:

  1. Prepare a journal entry for each transaction.             
  2. Post the transaction to T-account.                                                                 
  3. Prepare and post any necessary adjusting entries at August 31, 2018 as per following information.                                                                                                               
    1.  The note payable requires the entire $30,000 in principal plus interest at 10% to be paid   on July 31, 2019. The date of the loan is August 1, 2018.
  1. Depreciation on the equipment for the month of August is $500.
  2. The note receivable is dated August 16, 2018. The note requires the entire $20,000 in

     principal plus interest at 12% to be repaid in four months (the loan was outstanding for

     half month of the August).

  1. The prepaid rent of $6,000 represents rent for the months of August and September.
  2. Supplies on hand total $30,000.
  1. Prepare an adjusted trial balance as of August 31, 2016.                  
  2. Prepare an Income Statement and statement of Financial Position.                         

Record and post closing entries.        

Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 5 steps

Blurred answer
Knowledge Booster
Completing the Accounting Cycle
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education