Transactions Alex and Hagi decided to open a home cleaning service company, H@L The following information is a partial list of transactions from H@L Inc. January 1- Alex and Hagi each donated $ 25.000 in exchange for common stock to start the business. March 3- H@L Inc., paid $ 3.000 cash for a two-year insurance policy that was effective immediately. March 15-The Company purchased $8.000 of supplies on account. April 5- The Company purchased some cleaning equipment for $10.000 cash. The equipment should last for five years with no residual value. H@L company will take a full year of depreciation in 2020. May 1-H@L Inc., purchased a year's worth of advertising in a local newspaper for $ 1.200 cash. September 1- The Company obtained a nine-month loan for $ 15.000 at 5% from Do Not Trust Bank, with interest and principal payable on June 2021. December 31- The Company paid $ 5.000 of accounts payable owed from transaction 3. December 31- The Company earned service revenues of $ 26.225, of which $23.225 were on account. Note The company had $2.000 of the supplies still on hand at the end of the year. Requirements: 1- Give the journal entries for the transactions: include any adjusting entries. 2- Post the journal entries to T accounts, prepare an adjusted trial balance at December 31, 2020. 3- Prepare the income statement, and the balance sheet at December 31, 2020. Then, prepare the closing entries.
Transactions Alex and Hagi decided to open a home cleaning service company, H@L The following information is a partial list of transactions from H@L Inc. January 1- Alex and Hagi each donated $ 25.000 in exchange for common stock to start the business. March 3- H@L Inc., paid $ 3.000 cash for a two-year insurance policy that was effective immediately. March 15-The Company purchased $8.000 of supplies on account. April 5- The Company purchased some cleaning equipment for $10.000 cash. The equipment should last for five years with no residual value. H@L company will take a full year of depreciation in 2020. May 1-H@L Inc., purchased a year's worth of advertising in a local newspaper for $ 1.200 cash. September 1- The Company obtained a nine-month loan for $ 15.000 at 5% from Do Not Trust Bank, with interest and principal payable on June 2021. December 31- The Company paid $ 5.000 of accounts payable owed from transaction 3. December 31- The Company earned service revenues of $ 26.225, of which $23.225 were on account. Note The company had $2.000 of the supplies still on hand at the end of the year. Requirements: 1- Give the journal entries for the transactions: include any adjusting entries. 2- Post the journal entries to T accounts, prepare an adjusted trial balance at December 31, 2020. 3- Prepare the income statement, and the balance sheet at December 31, 2020. Then, prepare the closing entries.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Transactions
Alex and Hagi decided to open a home cleaning service company, H@L
The following information is a
partial list of transactions from H@L Inc.
January 1- Alex and Hagi each donated $ 25.000 in exchange for common stock to start the business.
March 3- H@L Inc., paid $ 3.000 cash for a two-year insurance policy that was effective immediately.
March 15-The Company purchased $8.000 of supplies on account.
April 5- The Company purchased some cleaning equipment for $10.000 cash. The equipment should last
for five years with no residual value. H@L company will take a full year of depreciation in 2020.
May 1-H@L Inc., purchased a year's worth of advertising in a local newspaper for $ 1.200 cash.
September 1- The Company obtained a nine-month loan for $ 15.000 at 5% from Do Not Trust Bank, with
interest and principal payable on June 2021.
December 31- The Company paid $ 5.000 of accounts payable owed from transaction 3.
December 31- The Company earned service revenues of $ 26.225, of which $23.225 were on account.
Note
The company had $2.000 of the supplies still on hand at the end of the year.
Requirements:
1- Give the journal entries for the transactions: include any adjusting entries.
2- Post the journal entries to T accounts, prepare an adjusted trial balance at December 31, 2020.
3- Prepare the income statement, and the balance sheet at December 31, 2020. Then, prepare the closing
entries.
Transcribed Image Text:H@L Co,. (Adjusted) Trial Balance
December 31, 2020
Amount
Net Amount
Account Name
Debit
Credit
Debit
Credit
TOTAL
H@L Corporation
Income Statement
For the Year Ended December 31, 2020
A- Gross Sales
B- Sales Deductions (-)
C- Net Sales
D- Cost of Goods (Service) Sold (-)
Gross Profit or Loss
E- Operating Expense (-)
Operating Profit or Loss
F- Income and Profit From Other Operations
G- Expenses and Loss From Other Operations (-)
H- Financial Expenses (-)
Income or Loss For the Period
Net Profit or Loss For the Period
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