ACCOUNTING
Comprehensive Problem 1 Kelly Pitney began her consulting business, Kelly Consulting, on April 1, 2012. The accounting cycle for Kelly Consulting for April , including financial statements was illustrated on pages 163-173. During May, Kelly Consulting entered into the following transactions:
May 3. Received cash from clients as an advance payment for services to be provided and recorded it as unearned fees, $3,000.
5. Received cash from clients on account, $2,100.
9. Paid cash for a newspaper advertisement, $300.
AND SO ON
Instructions:
1. The chart of accounts for Kelly Consulting is shown on page 164, and the post-closing trial balance as of April 30, 2012 is shown on page 171. For each account in the post-closing trial balance, enter the balance in the appropriate balance column of a four column account. Date the balances May 1, 2012, and place a check mark in the posting reference column. Journalize each of the May transactions in a two column journal starting on page 5 of the journal and using Kelly Consulting's chart of accounts. (do not insert the account numbers in the journal at this time.)
2. Post the journal to a ledger of four-column accounts.
3. Prepare an unadjusted trial balance
4. At the end of May, the following adjustment data were assembled. Analyze and use these data to complete parts 5 and 6.
a. Insurance expired during May is $300.
b. Supplies on hand on May 31 are $750.
c. Depreciation of office equipment for May is $330.
d. Accrued receptionist salary on May 31 is $300.
e. Rent expired during May is $1,600.
f. Unearned fees on May 31 are $1,500
5. Optional: Enter the unadjusted trial balance on an end-of-period spreadsheet (worksheet) and complete the spreadsheet.
6. Journalize and post the adjusting entries.
7.Prepare an adjusted trial balance.
8. Prepare an income statement, a statement of owner's equity, and a balance sheet.
9. Prepare and post the closing entries. (Income summary is account #33 in the chart of accounts.) Indicate closed accounts by inserting a line in both the Balance columns opposite the closing entry.
10. Prepare a post-closing trial balance
Check: Net Income $25,680
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