Reference no: EM132984050

Karla Tanner opens a Web consulting business called Linkworks and completed the following transactions in its first month of operations.

April

1 Tanner invested $135,000 cash along with office equipment valued at $32,400 in the company.

2 The company prepaid $7,200 cash for 12 months' rent for office space. Hint: Debit Prepaid Rent for $7,200.

3 The company made credit purchases for $16,200 in office equipment and $3,240 in office supplies. Payment is due within 10 days.

6 The company completed services for a client and immediately received $2,000 cash.

9 The company completed a $10,800 project for a client, who must pay within 30 days.

13 The company paid $19,440 cash to settle the account payable created on April 3.

19 The company paid $6,000 cash for the premium on a 12-month insurance policy. Hint: Debit Prepaid Insurance for $6,000.

22 The company received $8,640 cash as partial payment for the work completed on April 9.

25 The company completed work for another client for $2,640 on credit.

28 Tanner withdrew $6,200 cash from the company for personal use.

29 The company purchased $1,080 of additional office supplies on credit.

30 The company paid $700 cash for this month's utility bill.

Required:

Problem 1. Prepare general journal entries to record these transactions using the following titles: Cash (101); Accounts Receivable (106); Office Supplies (124); Prepaid Insurance (128); Prepaid Rent (131); Office Equipment (163); Accounts Payable (201); K. Tanner, Capital (301); K. Tanner, Withdrawals (302); Services Revenue (403); and Utilities Expense (690).

Problem 2. Post the journal entries from part 1 to the ledger accounts.

Problem 3. Prepare a trial balance as of April 30.