Mar. 3 Issued Check No. 116 for $7,500 for the current month’s advertising. 6 Is
ID: 2490717 • Letter: M
Question
Mar. 3 Issued Check No. 116 for $7,500 for the current month’s advertising.
6 Issued Check No. 117 for $2,000 for March office rent.
8 Received $11,500 from Ruth Garcia for services rendered to decorate her living room.
13 Performed decorating services on account for Nancy’s Accounting Firm for $8,600 (net 30).
Mar. 20 Performed decorating services on account for La Epoca Beauty Boutique for $18,000 (net 90).
26 Performed decorating services on account for Andrea’s Gourmet Food for $4,300 (net 30).
30 Issued Check No. 118 for $280 to pay the utilities bill for the month.
30 Issued Check No. 119 for $300 in payment of the telephone bill for the month.
30 Issued Check No. 120 for $240 for postage.
30 Issued Check No. 121 for $550 for business automobile expenses.
Adjusting Entries
a) Expired insurance for the period, $500.
b) Supplies on hand at the end of the month, $250.
c) Accrued salary expense (earned but not paid) owed to Sophia LeBron, $5,600. (Credit Accrued Salaries. Payroll taxes are not considered in this entry. Transactions in later months will show you how to journalize payroll tax deductions and expenses.)
d) Provision for uncollectible accounts estimated at 3.0% of March credit sales, $927.
1) Journalize the transactions listed below and on the next page and post to the ledger accounts. Omit explanations.
2) Prepare an unadjusted trial balance.
3) Journalize the adjusting entries and post to the general ledger. Adjustment data are provided on the next page.
4) Prepare an adjusted trial balance.
5) Prepare a schedule of accounts receivable.
6) Prepare an income statement for the three months ended March 31, 20--. If not completing the optional requirements below, use only the year-to-date amount column to complete your statement.
7) Prepare a retained earnings statement for the three months ended March 31, 20--.
8) Prepare a balance sheet as of March 31, 20--.
9) Complete the analysis test for March on page 47.
Explanation / Answer
Journal entries for March:
Adjusting entries:
Date Account Titles Debit Credit March $ $ 3 Advertising expense 7,500 Cash 7,500 6 Rent expense 2,000 Cash 2,000 8 Cash 11,500 Service revenue 11,500 13 Accounts receivable 8,600 Service revenue 8,600 20 Accounts receivable 18,000 Service revenue 18,000 26 Accounts receivable 4,300 Service revenue 4,300 30 Utilities expense 280 Cash 280 30 Telephone expense 300 Cash 300 30 Postage expense 240 Cash 240 30 Automobile expense 550 Cash 550