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FAR Chap 9 Problem 3

The document shows journal entries for a business over the course of a year. It records transactions for revenues, expenses, assets, liabilities, and equity. It also includes an income statement and balance sheet.

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adrian
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58 views

FAR Chap 9 Problem 3

The document shows journal entries for a business over the course of a year. It records transactions for revenues, expenses, assets, liabilities, and equity. It also includes an income statement and balance sheet.

Uploaded by

adrian
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
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Accounts Dr. Cr.

1 Cash 100,000.00
Owner's Equity 100,000.00
Initial Investment

2 Supplies Expense 60,000.00


Cash 60,000.00
Purchase supplies

3 Accounts Receivable 400,000.00


Service Income 400,000.00
Billed customers

4 Cash 270,000.00
Accounts Receivable 270,000.00
Collected cash from customers

5 Owner's Drawing 60,000.00


Cash 60,000.00
Personal withdrawal

6 Salaries Expense 180,000.00


Cash 180,000.00
Paid Salaries
Cash Accounts Receivable
100,000.00 60,000.00 400,000.00 270,000.00
270,000.00 60,000.00
180,000.00
370,000.00 300,000.00 400,000.00
(300,000.00) (270,000.00)
70,000.00 130,000.00

Owner's Drawing Service Income


60,000.00 400,000.00

60,000.00 400,000.00

Salaries Expense
180,000.00

180,000.00
Owner's Equity
100,000.00

100,000.00

Supplies Expense
60,000.00

60,000.00
Accounts Dr. Cr.
Cash 70,000.00
Accounts Receivable 130,000.00
Owner's Equity 100,000.00
Owner's Drawing 60,000.00
Service Income 400,000.00
Supplies Expense 60,000.00
Salaries Expense 180,000.00
TOTALS 500,000.00 500,000.00
Date Accounts Dr. Cr.
1 Bad Debts Expense 10,000.00
Allowance for Doubtful Accounts 10,000.00
Doubtful Accounts

2 Prepaid Supplies 20,000.00


Supplies Expense 20,000.00
Unused Supplies

3 Salaries Expense 30,000.00


Salaries Payable 30,000.00
Unpaid Salaries
Date Accounts
CL.E 1 Service Income
Supplies Expense
Salaries Expense
Bad Debts Expense
Income Summary
To close income and expense to income summary

CL.E 2 Income Summary


Owner's Equity
To close income summary to owner's equity

CL.E 3 Owner's Equity


Owner's Drawing
To close owner's drawing to owner's equity
Dr. Cr.
400,000.00
40,000.00
210,000.00
10,000.00
140,000.00

140,000.00
140,000.00

60,000.00
60,000.00
Unadjsuted Trial Balance
Accounts Dr. Cr.
Cash 70,000.00
Accounts Receivable 130,000.00
Owner's Equity 100,000.00
Owner's Drawing 60,000.00
Service Income 400,000.00
Supplies Expense 60,000.00
Salaries Expense 180,000.00
TOTAL 500,000.00 500,000.00

Adjustments
Allowance for Doubtful Accounts
Prepaid Supplies
Salaries Payable
Bad Debts Expense

TOTAL
Adjustments Adjusted Trial Balance Income Statement Balance Sheet
Dr. Cr. Dr. Cr. Dr. Cr. Dr.
70,000.00 70,000.00
130,000.00 130,000.00
100,000.00
60,000.00 60,000.00
400,000.00 400,000.00
20,000.00 40,000.00 40,000.00
30,000.00 210,000.00 210,000.00

10,000.00 10,000.00
20,000.00 20,000.00 20,000.00
30,000.00 30,000.00
10,000.00 10,000.00 10,000.00

60,000.00 60,000.00 540,000.00 540,000.00 260,000.00 400,000.00 280,000.00


140,000.00
400,000.00 400,000.00 280,000.00
Balance Sheet Closing Entries Post Closing Trial Balance
Cr. Dr. Cr. Dr. Cr.
70,000.00
130,000.00
100,000.00 60,000.00 140,000.00 180,000.00
60,000.00
400,000.00
40,000.00
210,000.00

10,000.00 10,000.00
20,000.00
30,000.00 30,000.00
10,000.00

140,000.00 460,000.00 460,000.00 220,000.00 220,000.00


140,000.00
280,000.00
GUITAR DOC
INCOME STATEMENT
For the year ended Dec. 31 20x1

INCOME
Service Income 400,000.00

EXPENSES
Supplies Expense 40,000.00
Salaries Expense 210,000.00
Bad Debt Expense 10,000.00
TOTAL EXPENSES 260,000.00

PROFIT 140,000.00
GUITAR DOC
INCOME STATEMENT
For the year ended Dec. 31 20x1

ASSETS
Cash 70,000.00
Accounts Receivable 130,000.00
Allowance for Doubtful Accounts (10,000.00)
Prepaid Supplies 20,000.00
TOTAL ASSETS 210,000.00

LIABILITIES
Salaries Payable 30,000.00
TOTAL LIABILITIES 30,000.00

OWNER'S EQUITY
Owner's Equity 180,000.00
TOTAL OWNER'S EQUITY 180,000.00

TOTAL LIABILITY AND OWNER'S EQUITY 210,000.00

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