Mike Greenberg opened Clean Window Washing Inc. on July 1, 2014. During July, th
ID: 2474166 • Letter: M
Question
Mike Greenberg opened Clean Window Washing Inc. on July 1, 2014. During July, the following transactions were completed. July 1 Issued 13,623 shares of common stock for $13,623 cash. 1 Purchased used truck for $9,623, paying $2,041 cash and the balance on account. 3 Purchased cleaning supplies for $909 on account. 5 Paid $2,280 cash on a 1-year insurance policy effective July 1. 12 Billed customers $4,890 for cleaning services. 18 Paid $1,180 cash on amount owed on truck and $505 on amount owed on cleaning supplies. 20 Paid $2,104 cash for employee salaries. 21 Collected $1,652 cash from customers billed on July 12. 25 Billed customers $2,552 for cleaning services. 31 Paid $390 for maintenance of the truck during month. 31 Declared and paid $643 cash dividend. Journalize the July transactions. Post to the ledger accounts. Prepare a trial balance at July 31. Journalize the following adjustments. (1) Services performed but unbilled and uncollected at July 31 were $1,831. (2) Depreciation on equipment for the month was $184. (3) One-twelfth of the insurance expired. (4) An inventory count shows $320 of cleaning supplies on hand at July 31. (5) Accrued but unpaid employee salaries were $423. Post adjusting entries to the T-accounts. Cash 7/1 13,623 7/1 2,041 7/21 1,652 7/5 2,280 7/18 1,685 7/20 2,104 7/31 390 7/31 643 7/31 Bal. 6,132 Accounts Receivable 7/12 4,890 7/21 1,652 7/25 2,552 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. Supplies 7/3 909 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. Prepaid Insurance 7/5 2,280 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. Equipment 7/1 9,623 7/31 Bal. 9,623 Accumulated Depreciation-Equipment 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. Accounts Payable 7/18 1,685 7/1 7,582 7/3 909 7/31 Bal. 6,806 Salaries and Wages Payable 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. Common Stock 7/1 13,623 7/31 Bal. 13,623 Dividends 7/31 643 7/31 Bal. 643 Service Revenue 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/12 4,890 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/25 2,552 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. Maintenance and Repairs Expense 7/31 390 7/31 Bal. 390 Supplies Expense 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. Depreciation Expense 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. Insurance Expense 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. Salaries and Wages Expense 7/20 2,104 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal. 7/17/37/57/127/187/207/217/257/317/31 Bal.
Explanation / Answer
Journal is the primary book where transactions are recorded immediately on their occurance. rules are-
1. for personal accounts (Accounts with name of individuals): Debit the receiver credit the giver.
2. Real Account: All assets on receipt are debited and when goes out is credited. Liabilities on incurrance are credited and on payment are debited.
3. Nominal accounts: Debit all expenses and losses. Credit all income and gains.
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Ledger posting:
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Adjustment etries:
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Dated Details Debit Credit July 1 Cash .............. $13,623 Common stock .......... $13,623 (Issued stock of 13,623 at $13,623) July1 Equipment.................................. $9,623 Cash ...................................... $2,041 Accounts payable.................... $7,582 (Purchased used truck of $9,623 paying $2,041cash and balance on credit) Supplies.............................................. $909 Accouts payables......................... $909 (Purchased on account cleaning supplies) Insurance Expenses............................... $2,280 Cash............................................... $2,280 (Paid one year Insurance policy effective from July 1) July 12 Accounts receivables............................... $4,890 Service revenue.............................. $4,890 (Billed for cleaning service) July 18 Accounts payable.................................. $1,685 Cash..................................... $1,685 (Paid $1,180 for truck and 505 for supplies) July 20 Salaries....................................................... $2,104 Cash..................................................... $2,104 (Paid salaries in cash) July 21 Cash........................................................ $1,652 Accounts receivable............................. $1,6452 (Received cash from service billed on 12th July) July 25 Accounts receivable..................................... $2,552 Service Revenue....................................... $2,552 (Billed for cleaning service) July 31 Maintenace & repair........................................ $390 Cash......................................................... $390 (Paid for maintenance of equipments) July 31 Dividends....................................................... $643 Cash....................................................... $643 (Paid Dividends in cash)