Reference no: EM13390266

Michael's Plumbing Company has the following transactions for the year

December 1 – Issued capital stock for $50,000 to start plumbing business.

December 1 - Paid gas expense $500.

December 1 - Paid one year insurance premium costing $3,600.

December 2 - Received $3,000 for job to install plumbing system in January next year.

December 8 – Plumbing repairs for three houses totaling $15,000 and billed customers.

December 10 - Purchased equipment costing $8,400 on credit.

December 12 - Purchased supplies costing $900 on credit.

December 23 – Plumbing services completed and billed to customers for $1,500.

December 24 - Paid for equipment purchased on December 10th.

December 28 - Received $2,000 for the repairs done on December 8th.

December 31 - Paid a $1,000 dividend.

Required:

1.  Prepare journal entries for the above transactions.  Be sure to identify them as a through k. 

2.  Post the above transactions to T Accounts.

3.  Prepare a Trial Balance.

4.  Prepare adjusting entries in journal format and post to T Accounts.

Supplies on Hand December 31 was $500.

The Equipment is to be depreciated over 48 months starting with December. 

(HINT:             Record one month depreciation expense).

Wages owed but not paid on December 31 was $250.

One month of insurance has expired. 

5.  Prepare an Adjusted Trial Balance.

6.  Prepare an Income Statement, Statement of Retained Earnings and a Balance Sheet.

7.  Prepare closing entries in journal format and post to the T Accounts.

8.  Prepare a Post-Closing Trial Balance.