Complete Solution in Excel File

Complete Solution in Excel File

Business Transactions for May 1978:

 May 1 Joe Josepher invested $10,000, a building worth $20,000, and supplies valued at $5,000 in the business.

May 4 Purchased $15,000 of equipment, paying $1,000 cash and signing a two-year, 10% note payable for the remainder. May 7 Rendered services to customers for $3,000 cash and $8,000 on credit.

May 10 Used up $1,000 worth of supplies.

May 11 Paid salaries of employees $2,000.

May 25 Paid rent for May, $900.

May 30 Borrowed $10,000 from the Third National Bank, signing a 90 day, 10% note.

The KKPK Co. prepares financial statements once each year at the end of December. Below is the trial balance for the company as of December 31, 1978, and the additional information needed for the adjustments. Complete a worksheet.


Trial Balance

December 31, 1978 Cash $10,000

Accounts receivable $8,000

Prepaid insurance $1,200

Supplies $3,000

Equipment $10,000

Accumulated depreciation-Equipment $4,000

Accounts payable $4,000

Notes payable $5,000

G. Keith, Capital $9,400

G. Keith withdrawals $6,000

Service revenue $30,000

Miscellaneous Revenue $2,000

Salaries expense $8,000

Rent expense $4,800

Utilities expense $2,400

Miscellaneous expense $1,000

Total $54,400 $54,400

Information for adjustments:

a. Account of the supplies on hand on December 31 indicated a total of $400.

b. The equipment has a ten year life.

c. The prepaid insurance policy was purchased in 1976. The life of the policy was three years(1976-1978).

d. Salaries earned by the employees during the year, but unpaid as of December 31, totaled $500.

e. Interest of $1,000 was incurred but not paid as of December 31.

f. The property taxes for 1978($1,000) will be paid in January, 1979

Record the following transactions in the general journal provided and post each transaction to the ledger accounts provided.

101 Cash

102 Accounts Receivable

103 Supplies

105 Building

107 Equipment

203 Notes Payable

301 Joe Josepher, Capital

302 Joe Josepher, Withdrawals

401 Service Revenue

501 Supplies expense

503 Salaries expense

505 Rent expense

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