Reference no: EM132419790
Consulting Services, Inc., opened for business on January 25, 2018. The company maintains the following ledger accounts: Cash - Capital Stock - Accounts Receivable - Retained Earnings - Office Supplies - Consulting Revenue - Office Equipment - Rent Expense - Accounts Payable - Utilities Expense.
The company engaged in the following business activity in January:
Jan. 20 Issued 5,000 shares of capital stock for $50,000.
Jan. 20 Paid $400 office rent for the remainder of January.
Jan. 21 Purchased office supplies for $200. The supplies will last for several months, and payment is not due until February 15.
Jan. 22 Purchased office equipment for $15,000 cash.
Jan. 26 Performed consulting services and billed clients $2,000. The entire amount will not be collected until February.
Jan. 31 Recorded $100 utilities expense. Payment is not due until February 20.
Instructions
a. Record each of these transactions in general journal form.
b. Post each entry to the appropriate ledger accounts.
c. a trial balance dated January 31, 2018.
d. Explain why the Retained Earnings account has a zero balance in the trial balance.
e. Knowing the eight steps comprising a accounting cycle, what steps are missing after doing a + b + c to complete the cycle