Column format to set up each ledger account

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Reference no: EM13892786

On April 1, 2013, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the company's first month.

April 1 Nozomi invested $30,000 cash and computer equipment worth $20,000 in the company.
2 The company rented furnished office space by paying $1,800 cash for the first month's (April) rent.
3 The company purchased $1,000 of office supplies for cash.
10 The company paid $2,400 cash for the premium on a 12 month insurance policy. Coverage begins on April 11.
14 The company paid $1,600 cash for two weeks' salaries earned by employees.
24 The company collected $8,000 cash on commissions from airlines on tickets obtained for customers.
28 The company paid $1,600 cash for two weeks' salaries earned by employees.
29 The company paid $350 cash for minor repairs to the company's computer.
30 The company paid $750 cash for this month's telephone bill.
30 Nozomi withdrew $1,500 cash from the company for personal use.

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Required:

1. Use the balance column format to set up each ledger account listed in its chart of accounts.
2. Prepare journal entries to record the transactions for April and post them to the ledger accounts. The company records prepaid and unearned items in balance sheet accounts.
3. Prepare an unadjusted trial balance as of April 30.
4. Use the following information to journalize and post adjusting entries for the month:
a. Two thirds (or $133) of one month's insurance coverage has expired.
b. At the end of the month, $600 of office supplies are still available.
c. This month's depreciation on the computer equipment is $500.
d. Employees earned $420 of unpaid and unrecorded salaries as of month end.
e. The company earned $1,750 of commissions that are not yet billed at month end.
5. Prepare the adjusted trial balance as of April 30. Prepare the income statement and the statement of owner's equity for the month of April and the balance sheet at April 30, 2013.
6. Prepare journal entries to close the temporary accounts and post these entries to the ledger.
7. Prepare a post closing trialbalance.

Reference no: EM13892786

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