Comprehensive Accounting Problem 4 - Delivery Service (Complete Accounting Cycle)

Notice: There are several versions of this problem; under company name "Delivery Service" and the difference in these versions are in the amounts for the adjusting entries so please compare your requirement to this posted problem carefully.

Comprehensive Problem

Delivery Service completed the following transactions during its first month of operations for Jan. 2012.

a. Delivery Service began operations by receiving $6,000 cash and a truck valued at $11,000. The business gave delivery company capital to aquire these assets. (put truck in at value)

b.Paid $300 cash for supplies

c. Prepaid insurance, $700

d. Performed delivery services for a customer and received $800 cash

e. Completed a large delivery job billed customer 1500 and received a promise to collect the $1,500 within one week.

f. Paid employee salary $700

g. Received $12,000 cash for performing delivery services

h. Collected $600 in advance for delivery service to be performed later .

i. Collected $1,500 cash from a customer on account

j. Purchased fuel for truck paying $200 with a company credit card(credit accounts payable)

K Performed delivery services on account $900.

l. Paid office rent $600. This rent is not paid in advance.

m. Paid $200 on account.

n. owner withdrew cash of $2,100.



Requirements:

1. Record each transaction in journal. Key each transaction by its letter . Explanations are not required.

2. Post transactions that you recorded in Requirement a in the in T-accounts.

Cash

Accounts Receivable

Supplies

Prepaid Insurance

Delivery truck

Accumulated Depreciation

Accounts Payable

Salary Payable

Unearned Service Revenue

Delivery Service, Capital

Delivery Service, Withdrawals

Income Summary

Service Revenue

Salary Expense

Depreciation Expense

Insurance Expense

Fuel Expense

Rent Expense

Supplies Expense

3. Enter trial balance in worksheet for the month ended January 31 2012. Complete using adjustment data given January 31.

a. Accrued salary expense $700

b. Depreciation expense $60

c. Prepaid Insurance expired, $60.

d. Supplies on hand $200

e. Unearned service rev earned during January $500

4. Prepare Matthews Delivery Services' income statement and statement of retained earnings for the month ended January 31, 2012, and the classified balance sheet on that date. (on the income statement list expenses in decreasing order by amount that, is the largest expense first, smallest last.)

5. Journalize and pot the adjusting entries beginning with a.

6. Journalize and post the closing entries

7. Prepare a post closing trial balance at January 31.2012
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