Reference no: EM132676649
Opening Balances:
Cash at Bank $16,800
Accounts Receivable $6,720
Supplies - Herbicides $2,800
Supplies - Fuel and Oil $1,200
Motor Vehicles $80,000
Accumulated Depreciation - Motor Vehicle $16,000 *
Paving Equipment - $30,800
Accumulated Depreciation - Paving Equipment $12,320 **
Accounts Payable $3,500
Unearned Revenue $5,000
Bank Loan $20,000
Capital $20,000
Paving Revenue $91,500
Landscaping Revenue $61,10
Wages Expense $62,200
Utilities Expense $28,900 *depreciation expense for motor vehicle is $8,000 per annum ** depreciation expense for paving equipment is $6,160 per annum
Transactions Occuring:
- CPL signed a lease agreement to lease a storage shed for a monthly rental of $2,600. Rent for 3 months was paid in advance.
- Paid for insurance premium $4,200, period of cover from 1 Jun 20 till 31 May 21
- CPL acquired a chipper and stump grinder equipment for a total cost of $40,320. A deposit of $8,500 was paid immediately and the balance was to be paid in 60 days. The equipment was expected to have a useful life of 6 years.
- Purchased a quantity of herbicide supplies for $1060 cash. Purchased fuel and oil supplies for $1740 cash.
- Signed a contract with Community Newspapers for 12 weeks of advertisements in its weekly free newspaper delivered to local homes. The business paid $1,800 in advance for these advertisements.
- Received cash of $1,800 from a grateful client on a small paving job completed by CPL before the open inspection for sale. Received cash of $2800 for several lawns that had been mowed for clients during the week.
- Signed a contract with the local shopping centre to provide landscaping maintenance services to its outdoor eating area for a monthly fee of $3200. The shopping centre paid for 2 months' services in advance.
- Received payment of $3,000 for landscaping services provided to clients during the past week.
- Paid casual wages of $4,540 for services provided to the business during the past fortnight.
- Earned $7,600 for paving services provided to client (of which $5,000 deposit was paid back in May) and balance owing collected this week. Also, earned $2,790 for landscaping during the past week. All money was received in cash except for one client for mowing services, who arranged to pay CPL $300, in 3 weeks' time for services rendered. 26 Paid casual wages $3,670 for services provided to the business during the past fortnight.
- Owner withdrew $4,000 in cash from the business in order to pay for the son's private school fees.
Adjusting Entries
1. Wages owing to all casuals on 30 June amounted to $1,620.
2. A physical count showed that only $860 of herbicide supplies and $750 of fuel and oil supplies were still on hand.
3. Four weeks of advertisements had appeared in the local community newspaper up to 30 June.
4. Paving services of $13,500 had been rendered to one of CPL major client on the last week of June but invoice has not been issued.
5. The business had provided landscaping maintenance services to its local shopping centre client for 3 weeks of the first month (assumed to be 4 weeks long).
6. Utilities bills arrived late, totalling to $2,650, have not been paid or recorded.
7. Interest accrued on the bank loan came to $1,200.
Problem 1: How to do an adjusted trial balance?