Reference no: EM131775549

The following are transactions for Leticia's Bookkeeping Services for the month of August .

1. Invested $12,500 into her new business.
2. Purchased office equipment for $5800 from Office Depot, paid on account.
3. Paid rent on her new office of $1000 for the next 2 months.
4. Paid insurance on her equipment of $45 for the month of August.
5. Bought supplies of $400 from Walmart, they were paid cash.
6. Billed her customers $4280 for services rendered, was paid cash.
7. Leticia took $400 for personal use.
8. Billed her customers $2100, received cash of $1200 and the balance to be paid in September.
9. Paid the light bill from CPL for $280.
10. Borrowed $4000 from IBC Bank.
11. Paid her employee, Mary Smith, for one week of wages. She is single, claims 2 allowances, earns $10/hour, gets paid overtime at time and a half, and worked 47 hours this week. ( do the payroll journal entry).

END OF MONTH ADJUSTMENT INFORMATION

a) supplies inventory at the end of the month = $165
b) Depreciation on the office equipment for one month = $96.
c) Wages earned by employees, but not paid in August = $225.
d) An advertising bill due to The Monitor is also due at the end of the month, but not paid = $300.

REQUIRED:

1. Record all the transactions in a journal and ledger.
2. Prepare a worksheet.
3. Journalize and post the adjusting entries.
4. Journalize and post the closing entries.
5. Prepare an income statement and balance sheet.
6. Show all the calculations for mary's payroll expense.
7. Please explain the difference between accounts receivable and accounts payable.
8. Please explain the difference between assets and liabilities.