Asked Dec 5, 2010, 07:55 AM
For the past several years, Kelly has operated a part-time consulting business from her home. As of April 1, 2006, Kelly decided to move to rented quarters and operate the business, which was to be known as Hippocrates Consulting, on a full-time basis. Hippocrates Consulting entered into the following transactions during April:
1. The following assets were received from Kelly:
I. Cash $ 15,100
Ii. Accounts Receivable $3,000
Iii. Supplies $ 1,400
Iv. Office Equipment $ 11,500
V. Capital $ 30,000
There were no liabilities received.
1. Paid three months rent on a lease rental contract, $ 4,800.
2. Paid the premium on property and casualty insurance policies $ 1,500.
4. Received cash from clients as an advance payment for services to be provided and recorded it as unearned fees, $ 5,000.
5. Purchased additional office equipment on account from Office Station Co., $ 2,000.
6. Received cash from clients on account, $ 3,800.
10. Paid cash for a newspaper advertisement, $ 120.
12. Paid Office Station Co. For part of the debt incurred on April 5, $ 1,500.
12. Recorded services provided on account for the period April 1-12 $ 4,200.
14. Paid part-time receptionist for two weeks salary, $ 700.
17. Recorded cash from cash clients for fee earned during the period April 1-16, $ 6,250.
18. Paid cash for supplies, $ 700.
20. Recorded services provided on account for the period April 13-20, $ 2,100.
24. Recorded cash from cash clients for fee earned during the period April 17-24, $ 3,550.
26. Received cash from clients on account, $ 5,600.
27. Paid part-time receptionist for two weeks salary, $ 750.
29. Paid telephone bill for April, $ 130.
30. Paid electricity bill for April, $ 300.
30. Recorded cash from cash clients for fee earned during the period April 25-30, $ 3,050.
30. Recorded services provided on account for the remainder of April, $ 1,500.
30. Kelly withdrew $ 5,000 for personal use.
1. Journalize each transaction in a two column journal.
2. Post the journal to the Ledger of four column accounts.
3. Prepare a Trail Balance as of April 30, 2006, on a ten column work sheet,
4. Journalize and post the adjusting entries, using the following adjusting data:
I. Insurance expired during April is $ 300.
Ii. Supplies on hand on April 30 are $ 1,350.
Iii. Depreciation of office equipment for April is $ 700.
Iv. Accrued receptionist salary on April 30 is $ 120.
V. Rent expired during April is $ 1,600.
Vi. Unearned fees on April 30 are $ 2,500.
5. Prepare an
I. Income Statement
Ii. Statement of owner's equity
Iii. Balance sheet
6. Journalize and post the closing entries.
7. Prepare a post-closing trial balance.