Financial Statement Assignment (FSA)
Instructions:
The aim of this assignment is to demonstrate the student's ability to communicate financial information.
The Task -
On April 1, 2011, Jennifer Stafford created a new travel agency. See-It-Now Travel. The following transactions occurred during the company's first month.
April - 1 Stafford invested $42,000 cash and computer equipment worth $30,000 in the company.
2 The company rented furnished office space by paying $2,300 cash for the first month's (April) rent.
3 The company purchased $1,800 of office supplies for cash.
10 The company paid $2,900 cash for the premium on a 12-month insurance policy. Coverage begins on April 11.
14 The company paid $800 cash for two weeks' salaries earned by employees.
24 The company collected $11,000 cash on commissions from airlines on tickets obtained for customers.
28 The company paid $800 cash for two weeks' salaries earned by employees.
29 The company paid $400 cash for minor repairs to the company's computer.
30 The company paid $1,250 cash for this month's telephone bill.
30 Stafford withdrew $2,300 cash from the company for personal use.
The company's chart of accounts follows:
|
101
|
Cash
|
405
|
Commissions Earned
|
|
106
|
Accounts Receivable
|
612
|
Depreciation Expense-Computer Equip.
|
|
124
|
Office Supplies
|
622
|
Salaries Expense
|
|
128
|
Prepaid Insurance
|
637
|
Insurance Expense
|
|
167
|
Computer Equipment
|
640
|
Rent Expense
|
|
168
|
Accumulated Depreciation-Computer Equip.
|
650
|
Office Supplies Expense
|
|
209
|
Salaries Payable
|
684
|
Repairs Expense
|
|
301
|
J. Stafford. Capital
|
688
|
Telephone Expense
|
|
302
|
J. Stafford. Withdrawals
|
901
|
Income Summary
|
Use the following information:
a. Two-thirds of one month's insurance coverage has expired.
b. At the end of the month. $400 of office supplies are still available.
c. This month's depreciation on the computer equipment is $600.
d. Employees earned $470 of unpaid and unrecorded salaries as of month-end.
e. The company earned $2,150 of commissions that are not yet billed at month-end.
Required:
1- Prepare journal entries to record the transactions for April and post them to the ledger accounts.
2- Prepare an unadjusted trial balance as of April 30. (Please prepare your trial balance in chart of accounts order given in the question).
3- Journalize and post adjusting entries for the month and prepare adjusted trial balance as of April 30.
4- Prepare the income statement for the month of April 30, 2011, the statement of owner's equity for the month of April 30, 2011 and the balance sheet at April 30, 2011.
5- Prepare journal entries to close the temporary accounts and prepare a post-closing trial balance.