Reference no: EM131333133

Accounting

I. For the month of January Jim's Landscaping Company has the following transactions:

1. Borrowed $5,000 from First National Bank on a note due in two years.
2. Received $12,500 cash from investors and issued them stock.
3. Purchased a vehicle for $12,000, paying $8,000 cash and signing a note for the balance that is due in three years.
4. Purchased supplies costing $600 on account.
5. Purchased supplies costing $400 paying cash.
6. Cut three lawns totaling $500 and billed customers.
7. Cut one lawn and was paid $300.
8. Paid wages totaling $600.
9. Purchased gas costing $200 on credit.
10. Paid for the gas purchased above.

Required:

1. Prepare journal entries for the above transactions.
2. Post the above transactions to T Accounts.
3. Prepare a Trial Balance.

II. Joan's dance studio had the following transactions during May.

1. Sold dance lessons totaling $5,000 to customers and was paid $3,000 in cash and the remainder on account.
2. Paid $800 in wages for May.
3. Received a utility bill for May totaling $600 that will be paid in June.
4. Received $1,000 deposit from customers in May for dance lessons to be conducted in June.

Required:

Prepare a cash basis and an accrual basis income statement.