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Posted by: Martin
Price Quoted by Student: $20
Posted On: 2015-11-29 09:09:44

ACT 101 – Comprehensive Problem


On January 1, 2005 Charlie Brown established a consulting business, Snoopy Consulting.  During the month, Charlie completed the following transactions to the business:


Jan         1              Charlie transferred cash from a personal bank account to an account to the used for the

business, $15,000.

                2              Purchased supplies for cash, $2,000.

                3              Paid three months’ rent on a lease rental contract, $3,600.

                4              Paid one years’ premium on property and casualty insurance policies, $1,200.

                5              Received cash from clients as an advance payment for services to be provided and

                                recorded it as unearned fees, $4,000.

                8              Purchased office equipment on account from Woods Company, $10,000.

                9              Paid cash for a newspaper advertisement, $150.

                10           Recorded services provided on account for the period January 1-10, $1,500.

                12           Paid part-time receptionist for two weeks’ salary, $900.

                15           Recorded cash from cash clients for fees earned during the first half of January, $3,000.

                16           Purchased supplies on account, $800.

                17           Received cash from clients on account, $1,000.

                18           Paid Woods Company for part of the debt incurred on January 8, $5,000.

                20           Recorded services provided on account for the period January 11-20, $1,200.

                22           Received cash from clients on account, $1,200.

                23           Paid telephone bill for January, $150.

                24           Paid part-time receptionist for two weeks’ salary, $900.

                29           Charlie withdrew $3,000 for personal use.

                30           Paid electricity bill for January, $250.

                31           Recorded cash from cash clients for fees earned for the remainder of January, $2,200.




Part 1 :
1.            Journalize each transaction in a two-column journal, referring to the following chart of accounts in selecting the accounts to be debited and credited.


11           Cash                                                                      31           Charlie Brown, Capital

12           Accounts Receivable                                      32           Charlie Brown, Drawing

14           Supplies                                                               33           Income Summary

15           Prepaid Rent                                                      41           Fees Earned

16           Prepaid Insurance                                           51           Salary Expense

18           Office Equipment                                            52           Rent Expense

19           Accumulated Depreciation                          53           Supplies Expense

21           Accounts Payable                                            54           Depreciation Expense

22           Salaries Payable                                                                55           Insurance Expense

23           Unearned Fees                                                 59           Miscellaneous Expense


2.            Post the journal to a ledger of four-column accounts.


Part 2 :

3.            Prepare a trial balance as of January 31, 2005, on a ten-column work sheet.  Complete the work sheet, using the following adjustment data:

a)      Supplies on hand on January 31 are $1,000.

b)      Rent expired during January is $1,200.

c)       Insurance expired during January is $100.

d)      Depreciation of office equipment for January is $500.

e)      Accrued receptionist salary on January 31 is $450.

f)       Unearned Fees on January 31 are $2,500.

4.            Journalize and post the adjusting entries.

5.            Journalize and post the closing entries.

6.            Prepare a post-closing trial balance.

7.           Prepare an income statement, a statement of owner’s equity and a balance sheet.


Attachment 1: Comprehensive Problem.docx
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