Reference no: EM133058278

Question - On August 1 2021, the beginning of its current fiscal year, the following opening account balances listed in alphabetical order were reported by ABC Corp.:

Accounts payable 2,300 Interest receivable 20

Accounts receivable 4,310 Note receivable, due Oct 31, 2021 4,000

Accumulated depreciation - equipment 2,000 Retained earnings 6,400

Cash 6,020 Salaries payable 1,420

Common Shares 12,000 Supplies 1,030

Equipment 10,000 Unearned revenue 1,260

During August, the following summary transactions were completed:

Aug. 1 - Paid $400 cash for advertising in local newspapers. Advertising flyers will be included with newspapers delivered during August and September. (Use Prepaid Advertising account)

Aug. 3 - Paid August rent of $380. (Use prepaid rent account)

Aug. 6 - Received $3,200 cash from customers in payment of accounts.

Aug. 10 - Paid $3,120 for salaries due employees, of which $1,700 is for August and $1,420 is for July salaries payable.

Aug. 13 - Received $3,800 cash for services performed in August.

Aug. 15 - Purchased additional equipment on account $2,000.

Aug. 17 - Paid vendors $2,000 of accounts payable due.

Aug. 22 - Purchased supplies on account for $800.

Aug. 24 - Paid salaries $2,900.

Aug. 27 - Performed services worth $4,760 on account and billed customers.

Aug. 29 - Received $780 from customers for services to be performed in the future.

Aug. 31 - Declared and paid a $500 dividend.

Required -

1. Create journal entry.

2. Set up T-accounts, enter any opening balances, and post the general journal entries completed from part (1).

3. Prepare a trial balance at August 31.

4. Prepare and post the August adjusting entries. Use the same T-accounts in part (2).

5. Prepare an adjusted trial balance as at August 31.