Acc280 Financial Accounting: (Appendix Q) Comprehensive Problem - Dustbusters Cleaning Company

Acc280 Financial Accounting

Appendix Q: Comprehensive Problem - Dustbusters Cleaning Company

Dustbusters Cleaning Company Chart of Accounts:

No. 101 Cash

No. 112 Accounts Receivable

No. 126 Cleaning Supplies

No. 130 Prepaid Insurance

No. 149 Equipment

No. 150 Accumulated Depreciation - Equipment

No. 201 Accounts Payable

No. 212 Salaries Payable

No. 311 Common Stock

No. 325 Retained Earnings

No. 340 Dividends

No. 350 Income Summary

No. 400 Service Revenue

No. 701 Cleaning Supplies Expense

No. 717 Depreciation Expense

No. 720 Gas & Oil Expense

No. 722 Insurance Expense

No. 729 Salaries Expense

Louise Dreyton opened Dustbusters Cleaning Company on February 1, 2010. During the first month of operation the following transactions occurred:

Feb 1 Dreyton invested $20,000 cash in exchange for common stock

1 Purchased used truck for $9000, paying $4,000 cash and the balance on account

2 Purchased cleaning supplies for $2,100 on account

7 Paid $1,800 cash for a one-year insurance policy effective February 1

11 Billed customers $5,100 for cleaning services

16 Paid $2,900 cash on Accounts Payable due

19 Paid $2,800 cash for employee salaries

21 Collected $3,400 cash from customers billed on account

25 Billed customers $9,000 for cleaning services

28 Paid gas & oil for the month on truck $350

28 Declared and paid a $1,600 cash dividend

Instructions:

(a) Journalize the February transactions on the tab labeled General Journal

(b) Post the February transactions on the tab labeled Ledger Accounts (Be sure to calculate the balance in the account after each posted transaction)

(c) Prepare a trial balance at February 28 on the tab labeled Trial Balance

(d) Journalize the adjusting entries on the tab labeled Adjusting Entries

(1) Services provided but unbilled and uncollected at February 28 are $2,700

(2) Depreciation on equipment for the month is $500

(3) One month of the insurance expired

(4) An inventory count shows $700 of cleaning supplies on hand at February 28

(5) Accrued but unpaid employee salaries are $1,000

(e) Post the adjusting entries on the tab labeled Ledger Accounts. (Be sure to calculate the balance in the account after each posted transaction)

(f) Prepare an adjusted trial balance at February 28 on the tab labeled Adjusted Trial Balance

(g) Prepare the income statement and retained earnings statement for February and a classified balance sheet at February 28 on the tab labeled Financial Statement

(h) Journalize the closing entries on the tab labeled Closing Entries

(i) Post the closing entries on the tab labeled Ledger Accounts. (Be sure to calculate the balance in the account after each posted transaction)

(j) Prepare a post-closing trial balance at February 28 on the tab labeled Post-Closing Trial Balance

(k) Bonus (Optional) - Complete the 10-column worksheet for Dustbusters Cleaning Company on the tab labeled Worksheet (The worksheet must be completed in its entirety to receive any bonus points)

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