Reference no: EM132694595

On july1, 2011, Lula Plume created a new self-storage business, Safe Storage Co. The following transactions occurred during the company's first month.

july 1 Luna Plume invested Cash $30,000 and Buildings worth $150,000 in the company and received Common Stock.

july2 The company rented equipment by paying $2,000 cash for the first month's (july) rent.

july 5 The company purchased $2,400 of office supplies for cash.

july 10 The company paid $7,200 cash for the premium on a 12-month insurance policy. Coverage begins on March 11.

july 14 The company paid an employee $1,000 cash for two weeks' salary earned.

july 24 The company collected $9,800 cash for storage fees from customers.

july 28 The company paid $1,000 cash for two weeks' salary earned by an employee.

july 29 The company paid $950 cash for minor repairs to a leaking roof.

july 30 The company paid $400 cash for this month's telephone bill.

july 31 Shareholder was paid $2,000 cash in Dividends.

The Luna Plume Company Chart of Accounts - 2011

Cash storage fees earned

Accounts receivable Depreciation Expense - Building

Office Supplies Salaries Expense

Prepaid Insurance Insurance Expense

Buildings Rent Expense

Accumulated Depreciation-Buildings Office Supplies Expense Salaries Payable Repairs Expense

Common Stock Telephone Expense

Dividends Income Summary

Retained Earnings

Required

Question 1: Prepare General Journal Entries for the following transactions.

Question 2: Then post the journal entries to the General Ledger and then make an Unadjusted Trial Balance. Your Trial Balance will be on the Worksheet.

Question 3: Use the following information to journalize and post adjusting entries for the month to the Ledger.

a. Two-thirds of one month's insurance coverage has expired.

b. At the end of the month, $1,525 of office supplies are still available.

c. This month's depreciation on the buildings is $1,500.

d. An employee earned $100 of unpaid and unrecorded salary as of month-end.

e. The company earned $1,150 of storage fees that are not yet billed at month-end.

Question 4: Prepare the Income Statement, the Statement of Owner's Equity and the Balance Sheet for the period. Make sure you have the proper headings for each financial statement.

Question 5: Then prepare the closing journal entries of the temporary accounts , post to the Ledger , and make a Post-Closing Trial Balance