ACC 290 P4-8A
Linda Blye opened Cardinal Window Washing Inc. on July 1, 2010. During July the following transactions were completed.
Issued 11,000 shares of common stock for $11,000 cash.
Purchased used truck for $9,000, paying $2,000 cash and the balance on account.
Purchased cleaning supplies for $900 on account.
Paid $1,800 cash on 1-year insurance policy effective July 1.
Billed customers $3,200 for cleaning services.
Paid $1,000 cash on amount owed on truck and $500 on amount owed on cleaning supplies.
Paid $2,000 cash for employee salaries.
Collected $1,400 cash from customers billed on July 12.
Billed customers $2,500 for cleaning services.
Paid $260 for gas and oil used in the truck during month.
Declared and paid $600 cash dividend.
The chart of accounts for Cardinal Window Washing contains the following accounts: Cash, Accounts Receivable, Cleaning Supplies, Prepaid Insurance, Equipment, Accumulated Depreciation—Equipment, 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.
Hint: Complete all steps in accounting cycle.
Journalize the July transactions.
Post to the ledger accounts. (Use T accounts.)
Prepare a trial balance at July 31.
Journalize the following adjustments.
Services provided but unbilled and uncollected at July 31 were $1,700.
Depreciation on equipment for the month was $250.
One-twelfth of the insurance expired.
An inventory count shows $360 of cleaning supplies on hand at July 31.
Accrued but unpaid employee salaries were $400.
Post adjusting entries to the T accounts.
Prepare an adjusted trial balance.
Cash $ 4,240
Prepare the income statement and a retained earnings statement for July and a classified balance sheet at July 31.
Tot. assets $21,000
Journalize and post closing entries and complete the closing process.
Prepare a post-closing trial balance at July 31.
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