ACC 280 / XACC 280
Axia College of University of Phoenix (UoP)
Principles of Accounting
Weygandt, J. J., Kimmel, P. D., & Kieso, D. E. (2008). Financial Accounting (6th ed.). Hoboken, NJ: Wiley.
ACC 280 / XACC 280 Solution
Help in ACC 280
Help in XACC 280
Problem 4-5A (P4-5A) Laura Eddy opened Eddy’s Carpet Cleaners Inc. on March 1. During March, the following transactions were completed.
Mar. 1 Issued stock for $10,000 in cash.
1 Purchased used truck for $6,000, paying $3,000 cash and the balance on account.
3 Purchased cleaning supplies for $1,200 on account.
5 Paid $1,200 cash on one-year insurance policy effective March 1.
14 Billed customers $4,800 for cleaning services.
18 Paid $1,500 cash on amount owed on truck and $500 on amount owed on cleaning supplies.
20 Paid $1,800 cash for employee salaries.
21 Collected $1,400 cash from customers billed on March 14.
28 Billed customers $2,500 for cleaning services.
31 Paid gas and oil for month on truck $200.
31 Declared and paid a $700 cash dividend.
The chart of accounts for Eddy’s Carpet Cleaners contains the following accounts: No. 101 Cash, No. 112 Accounts Receivable, No. 128 Cleaning Supplies, No. 130 Prepaid Insurance, No.157 Equipment, No. 158 Accumulated Depreciation—Equipment, No. 201 Accounts Payable, No. 212 Salaries Payable, No. 311 Common Stock, No. 320 Retained Earnings, No. 332 Dividends, No. 350 Income Summary, No. 400 Service Revenue, No. 633 Gas & Oil Expense, No. 634 Cleaning Supplies Expense, No. 711 Depreciation Expense, No. 722 Insurance Expense, and No. 726 Salaries Expense.
Instructions
(a) Journalize and post the March transactions. Use page J1 for the journal and the three-column form of account.
(b) Prepare a trial balance at March 31 on a worksheet.
(c) Enter the following adjustments on the worksheet and complete the worksheet.
(1) Earned but unbilled revenue at March 31 was $700.
(2) Depreciation on equipment for the month was $250.
(3) One-twelfth of the insurance expired.
(4) An inventory count shows $400 of cleaning supplies on hand at March 31.
(5) Accrued but unpaid employee salaries were $500.
(d) Prepare the income statement and a retained earnings statement for March and a classified balance sheet at March 31.
(e) Journalize and post adjusting entries. Use page J2 for the journal.
(f) Journalize and post closing entries and complete the closing process. Use page J3 for the journal.
(g) Prepare a post-closing trial balance at March 31.
Click here for the SOLUTION
