Q 1: NC operates a business closes its accounts and prepares financial statements at the end of each month. During the month of June entered into the following transactions: June 1 Owner deposited $ 150000 cash in a bank account . June 2 Purchased $ 240000 equipment, paid $ 100000 cash and issued a 9 percent note for the balance. June 3 Paid $ 10,000 four months advance rent. June 4 Received $12000 cash as advance payment on equipment from xyz company. June 5 Purchased office supplies on account from ABC $ 1850 payment due in 30 days. June 9 Purchased on account from F.P. distributor $ 290 parts needed to repair a rental tractor. Payment is due in ten days.( HINT: USE MAINTENANCE EXPENSE) June 10 Paid salaries for $ 3200. June 15 Equipment rental fees earned amount $ 8900 ,of which $ 7200 was received in cash. June 18 Paid the accounts payable to F.P. distributor. June 19 Collected $ 800 of the accounts receivable. June 23 Rented an equipment to M.L. company at a price $ 110 per day to be paid when returned back. This equipment is expected to remain with M.L company two to three weeks. June 25 Paid salaries $ 3200. June 28 Owner withdrew $ 3000 cash from the business for personal use. June 30 Equipment rent fees earned and received in cash amounted $ 7850. June 30 Received a bill from WAPDA for the month of June $ 340. Payment is due in 15 days. Other data: During June, the company earned $ 3210 of rental fees paid in advance on June 3. Office supplies on hand at June 30, are estimated at $ 1160. The rental equipment is being is being deprecated over a period of 10 years. The advance payment of rent on June 3 covered a period of four months. As of June 30 seven days rent on equipment rented to M.L .COMPANY has earned. As of June 30, interest accrued on note payable amounted to $ 1050. Salaries earned by employees amounted to $ 960. Required: 1. Prepare four closing entries from work sheet ?
Subject : Principles of Accounting
Q 1: NC operates a business closes its accounts and prepares financial statements at the end of each
month. During the month of June entered into the following transactions:
June 1 Owner deposited $ 150000 cash in a bank account .
June 2 Purchased $ 240000 equipment, paid $ 100000 cash and issued a 9 percent note for the
balance.
June 3 Paid $ 10,000 four months advance rent.
June 4 Received $12000 cash as advance payment on equipment from xyz company.
June 5 Purchased office supplies on account from ABC $ 1850 payment due in 30 days.
June 9 Purchased on account from F.P. distributor $ 290 parts needed to repair a rental tractor.
Payment is due in ten days.( HINT: USE MAINTENANCE EXPENSE)
June 10 Paid salaries for $ 3200.
June 15 Equipment rental fees earned amount $ 8900 ,of which $ 7200 was received in cash.
June 18 Paid the accounts payable to F.P. distributor.
June 19 Collected $ 800 of the
June 23 Rented an equipment to M.L. company at a price $ 110 per day to be paid when returned
back. This equipment is expected to remain with M.L company two to three weeks.
June 25 Paid salaries $ 3200.
June 28 Owner withdrew $ 3000 cash from the business for personal use.
June 30 Equipment rent fees earned and received in cash amounted $ 7850.
June 30 Received a bill from WAPDA for the month of June $ 340. Payment is due in 15 days.
Other data:
- During June, the company earned $ 3210 of rental fees paid in advance on June 3.
- Office supplies on hand at June 30, are estimated at $ 1160.
- The rental equipment is being is being deprecated over a period of 10 years.
- The advance payment of rent on June 3 covered a period of four months.
- As of June 30 seven days rent on equipment rented to M.L .COMPANY has earned.
- As of June 30, interest accrued on note payable amounted to $ 1050.
- Salaries earned by employees amounted to $ 960.
Required:
1. Prepare four closing entries from work sheet ?
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