Ralph Collins founded Collins Consignment Sales Company and the company was operated from his home. As of September 1, 2021, Collins decided to move to rented quarters and to operate the business on a full-time basis. He wishes to know how much net income the business has earned but has no prior knowledge of accounting and has approached your group for advice. The company entered the following transactions during September: Sept 1. The following assets were received from Ralph in exchange for capital of Collins Consignment Sales Company: cash - $19,000, accounts receivable - $2,800, supplies - $2,050, and office equipment - $15,000. There were no liabilities received. Paid three (3) months rent on a lease rental contract, $6,000. Paid the premiums on the property and peril insurance policies, $3,000. Received cash from clients as an advance payment for services to be provided in the coming months, $5,900. Purchased additional office equipment on account from Payne Company, $5,000. Received cash from clients on account, $800. Paid cash for newspaper advertisement, $1,720. Paid Payne Company a portion of the debt incurred on September 5, $2,000. Recorded services provided on account for the period September 1 -12, $1,200. Paid part-time receptionist for two weeks’ salary, at $500 per week. Recorded cash from cash clients for fees earned during the first half of September, $3,000. Paid cash for supplies, $750. Recorded services provided on account for the period September 13-20, $2,100. Recorded cash from cash clients for fees earned for the period September 17-24, $4,850. Received cash from clients on account, $1,300. Paid part-time receptionist for two weeks salary, at $500 per week. Paid telephone bill for September, $2,000. Paid electricity bill for September, $2,800. Recorded cash from cash clients for fees earned for the period September 25-30, $2,000. Recorded services provided on account for the remainder of September, $1,500. Post the journal entries to their respective ledger accounts. Prepare a trial balance based on the balances derived after completing requirement #2.

Ralph Collins founded Collins Consignment Sales Company and the company was operated from his home. As of September 1, 2021, Collins decided to move to rented quarters and to operate the business on a full-time basis. He wishes to know how much net income the business has earned but has no prior knowledge of accounting and has approached your group for advice. The company entered the following transactions during September: Sept 1. The following assets were received from Ralph in exchange for capital of Collins Consignment Sales Company: cash - $19,000, accounts receivable - $2,800, supplies - $2,050, and office equipment - $15,000. There were no liabilities received. Paid three (3) months rent on a lease rental contract, $6,000. Paid the premiums on the property and peril insurance policies, $3,000. Received cash from clients as an advance payment for services to be provided in the coming months, $5,900. Purchased additional office equipment on account from Payne Company, $5,000. Received cash from clients on account, $800. Paid cash for newspaper advertisement, $1,720. Paid Payne Company a portion of the debt incurred on September 5, $2,000. Recorded services provided on account for the period September 1 -12, $1,200. Paid part-time receptionist for two weeks’ salary, at $500 per week. Recorded cash from cash clients for fees earned during the first half of September, $3,000. Paid cash for supplies, $750. Recorded services provided on account for the period September 13-20, $2,100. Recorded cash from cash clients for fees earned for the period September 17-24, $4,850. Received cash from clients on account, $1,300. Paid part-time receptionist for two weeks salary, at $500 per week. Paid telephone bill for September, $2,000. Paid electricity bill for September, $2,800. Recorded cash from cash clients for fees earned for the period September 25-30, $2,000. Recorded services provided on account for the remainder of September, $1,500. Post the journal entries to their respective ledger accounts. Prepare a trial balance based on the balances derived after completing requirement #2.

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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Scenario:

Sept 1. The following assets were received from Ralph in exchange for capital of Collins Consignment Sales Company: cash - $19,000, accounts receivable - $2,800, supplies - $2,050, and office equipment - $15,000. There were no liabilities received.

Paid three (3) months rent on a lease rental contract, $6,000.
Paid the premiums on the property and peril insurance policies, $3,000.
Received cash from clients as an advance payment for services to be provided in the coming months, $5,900.
Purchased additional office equipment on account from Payne Company, $5,000.
Received cash from clients on account, $800.
Paid cash for newspaper advertisement, $1,720.
Paid Payne Company a portion of the debt incurred on September 5, $2,000.
Recorded services provided on account for the period September 1 -12, $1,200.
Paid part-time receptionist for two weeks’ salary, at $500 per week.
Recorded cash from cash clients for fees earned during the first half of September, $3,000.
Paid cash for supplies, $750.
Recorded services provided on account for the period September 13-20, $2,100.
Recorded cash from cash clients for fees earned for the period September 17-24, $4,850.
Received cash from clients on account, $1,300.
Paid part-time receptionist for two weeks salary, at $500 per week.
Paid telephone bill for September, $2,000.
Paid electricity bill for September, $2,800.
Recorded cash from cash clients for fees earned for the period September 25-30, $2,000.
Recorded services provided on account for the remainder of September, $1,500.

Post the journal entries to their respective ledger accounts.

Prepare a trial balance based on the balances derived after completing requirement #2.

The company presented the following adjustments, and you are to prepare the adjusting entries in the general journal (Narration required for each journal entry):
Insurance expired during September, $500.
Supplies on hand on September 30, $1,250.
Accrued receptionist salary on September 30, $500
Rent expired during September, $2,000.
Unearned fees on September 30 are $2,900.
Prepare the financial statements for the month of September for presentation to Ralph Collins.

Journalize the closing entries and balance off the ledger accounts including the income summary account.

Prepare the post-closing trial balance.

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