Joan Clark opened Clark Cleaners Inc. On January 1, 2010. During January the
Following transactions were completed.
Jan. 1 Issued 12,000 shares of common stock for $18,000 cash.
1 Purchased used truck for $12,000, paying $4,000 cash and the balance on
Account.
3 Purchased cleaning supplies for $940 on account.
5 Paid $7,200 cash on 1-year insurance policy effective January 1.
12 Billed customers $4,100 for cleaning services.
18 Paid $600 cash on amount owed on truck and $300 on amount owed on
Cleaning supplies.
20 Paid $2,100 cash for employee salaries.
21 Collected $2,300 cash from customers billed on January 12.
25 Billed customers $2,850 for cleaning services.
31 Paid $450 for gas and oil used in the truck during month.
31 Declared and paid $600 cash dividend.
The chart of accounts for Clark Cleaners contains the following accounts: Cash, Accounts
Receivable, Cleaning Supplies, Prepaid Insurance, Equipment, Accumulated Depreciation—
Problems: Set C 5
Journalize transactions and
Follow through accounting
Cycle to preparation of
Financial statements.
(SO 4, 5, 6)
Complete all steps in
Accounting cycle.
(SO 4, 5, 6, 7, 8)
(f) Cash $2,420
Tot. Trial balance $27,990
(g) Net loss $1,040Equipment, Accounts Payable, Salaries Payable, Common Stock, Retained Earnings,
Dividends, Income Summary, Service Revenue, Gas & Oil Expense, Cleaning Supplies
Expense, Depreciation Expense, Insurance Expense, Salaries Expense.
Instructions
(a) Journalize the January transactions.
(b) Post to the ledger accounts. (Use T accounts.)
(c) Prepare a trial balance at January 31.
(d) Journalize the following adjustments.
(1) Services provided but unbilled and uncollected at January 31 were $2,340.
(2) Depreciation on the truck for the month was $320.
(3) One-twelfth of the insurance expired.
(4) An inventory count shows $210 of cleaning supplies on hand at January 31.
(5) Accrued but unpaid employee salaries were $760.
(e) Post adjusting entries to the T accounts.
(f ) Prepare an adjusted trial balance.
(g) Prepare the income statement and a retained earnings statement for January and a
Classified balance sheet at January 31.
(h) Journalize and post closing entries and complete the closing process.
(I) Prepare a post-closing trial balance at January