Chapter 2, Problem 2.42PS

Journalizing transactions, posting to T-accounts, and preparing a trial balance

Consider the following transactional data for the first month of operations for Crystal Clear Cleaning.

Nov. 1	Stockholders contributed $35,000 and a truck, with a market value of $7,000, to the business in exchange for common stock.
2	The business paid $2,000 to Pleasant Properties for November through February rent. (Debit Prepaid Rent)
3	Paid $1,800 for a business insurance policy for the term November 1, 2017 through October 31, 2018. (Debit Prepaid Insurance)
4	Purchased cleaning supplies on account, $220.
5	Purchased on account an industrial vacuum cleaner costing $2,000. The invoice is payable November 25.
7	Paid $1,200 for a computer and printer.
9	Performed cleaning services on account in the amount of $3,800.
10	Received $300 for services rendered on November 9.
15	Paid employees, $350.
16	Received $12,000 for a 1-year contract beginning November 16 for cleaning services to be provided. Contract begins November 16, 2017, and ends November 15, 2018. (Credit Unearned Revenue)
17	Provided cleaning services and received $1,000 cash.
18	Received a utility bill for $250 with a due date of December 4, 2017. (Use Accounts Payable)
20	Borrowed $96,000 from bank with interest rate of 9% per year.
21	Received $900 on account for services performed on November 9.
25	Paid $1,000 on account for vacuum cleaner purchased on November 5.
29	Paid $500 for advertising.
30	Cash dividends of $200 were paid to stockholders.

Requirements

1. Journalize the transactions, using the following accounts: Cash; Accounts Receivable; Cleaning Supplies; Prepaid Rent; Prepaid Insurance; Equipment; Truck; Accounts Payable; Unearned Revenue; Notes Payable; Common Stock; Dividends; Service Revenue; Salaries Expense; Advertising Expense; and Utilities Expense. Explanations are not required.

2. Open a T-account for each account.

3. Post the journal entries to the T-accounts, and calculate account balances. Formal posting references are not required.

4. Prepare a trial balance as of November 30, 2017.