Question: On August 1, 20XX, Mindy Kleane opened a house-cleaning service called Kleane House.

Part 1. Prepare journal entries to record the transactions for August and post them to the accounts. The company records prepaid and unearned items in balance sheet accounts. (What do I debit/credit and to what account?)

Aug 1. Mindy Invested $25,000 cash and cleaning equipment worth $3,500.

Aug 2. Rented office space and paid $1,800 cash for the first month's rent.

Aug 3. Purchased $2,500 of cleaning supplies for cash.

Aug 3. Paid $3,000 cash premium for one-year liability insurance...coverage began immediately.

Aug 14. Paid $2,200 cash for salaries to 2 employees.

Aug 24. Collected $9,100 cash for house-cleaning services provided to customers.

Aug 28. Paid another $2,200 cash for salaries.

Aug 29. Paid this month's $250 telephone bill in cash.

Aug 31. Paid $500 cash for repairs for cleaning equipment.

Aug 31. Mindy Withdrew $3,750 cash from the business for personal use.

The company's chart of accounts include the following:

101 Cash                                                      405 Cleaning fees earned

106 Accounts receivable                                  612 Depreciation expense- cleaning equipment

124 Cleaning supplies                                      622 Salaries expense

128 Prepaid insurance                                     637 Insurance expense

167 Cleaning equipment                                   640 Rent expense

168 Accumulated depreciation- cleaning equipment 650 Cleaning supplies expense

209 Salaries payable                                        684 Repairs expense

301 M. Kleane, Capital                                      688 Telephone Expense

302 M. Kleane, Withdrawls                                901 Income summary

Part 2. Prepare an unadjusted trial balance. Complete the worksheet using the following information:

a. One month's insurance coverage has expired.

b. There are $1,600 of cleaning supplies available at the end of the month.

c. Depreciation on the cleaning equipment is $200.

d. The employees earned $220 of unpaid and unrecorded salaries.

e. The company earned $4,700 of fees are not yet billed.

Part 3. Journalize and post adjusting entries for the month.

Part 4. Prepared the income statement, the statement of owner's equity for August, and the balance sheet for August 31, 200X.

Part 5. Prepare journal entries to close the temporary accounts and post these entries to the ledger.

Part 6. Prepare a post-closing trial balance.

Part 7. Journalize any required reversing entries.