Reference no: EM132864559
Pavel opened Pavel's Cleaning Service on July 1, 2020. During July the following transactions were completed.
July
1 Pavel invested Tk.20,000 cash in the business.
1 Purchased used truck for Tk.9,000, paying Tk.4,000 cash and the balance on account.
3 Purchased cleaning supplies for Tk.2,100 on account.
5 Paid Tk.1,800 cash on one-year insurance policy effective July 1.
12 Billed customers Tk.4,500 for cleaning services.
18 Paid Tk.1,500 cash on amount owed on truck and Tk.1,400 on amount owed on cleaning supplies.
20 Paid Tk.2,500 cash for employee salaries.
21 Collected Tk.3,400 cash from customers billed on July 12.
25 Billed customers Tk.6,000 for cleaning services.
31 Paid gasoline for month on truck Tk.350.
31 Withdraw Tk.5,600 cash for personal use.
The chart of accounts for Pavel's Cleaning Service contains the following accounts:
No. 101Cash,
No. 112 Accounts Receivable,
No. 128 Supplies,
No. 130 Prepaid Insurance,
No. 157 Equipment,
No. 158 Accumulated Depreciation-Equipment,
No. 201 Accounts Payable,
No. 212 Salaries and Wages Payable,
No. 301 Owner's Capital,
No. 306 Owner's Drawings,
No. 350 Income Summary,
No. 400 Service Revenue,
No. 633 Gasoline Expense,
No. 634 Supplies Expense,
No. 711 Depreciation Expense,
No. 722 Insurance Expense, and
No. 726 Salaries and Wages Expense.
Instructions
Problem (a) Journalize and post the July transactions. Use page J1 for the journal and the three-column form of account.
Problem (b) Prepare a trial balance at July 31 on a worksheet.
Problem (c) Enter the following adjustments on the worksheet and complete the worksheet.
(1) Services provided but unbilled and uncollected at July 31 were Tk.2,700.
(2) Depreciation on equipment for the month was Tk.500.
(3) One-twelfth of the insurance expired.
(4) An inventory count shows Tk.600 of cleaning supplies on hand at July 31.
(5) Accrued but unpaid employee salaries were Tk.1,000.
Problem (d) Journalize and post-closing entries and complete the closing process.
Problem (e) Prepare a post-closing trial balance at July 31.