Question: on april 1 2017 jiro nozomi created a new travel...
On April 1, 2017, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the company’s first month.
|April||1||Nozomi invested $31,000 cash and computer equipment worth $35,000 in the company.|
|2||The company rented furnished office space by paying $1,500 cash for the first month’s (April) rent.|
|3||The company purchased $1,500 of office supplies for cash.|
|10||The company paid $2,600 cash for the premium on a 12-month insurance policy. Coverage begins on April 11.|
|14||The company paid $900 cash for two weeks' salaries earned by employees.|
|24||The company collected $18,000 cash on commissions from airlines on tickets obtained for customers.|
|28||The company paid $900 cash for two weeks' salaries earned by employees.|
|29||The company paid $350 cash for minor repairs to the company's computer.|
|30||The company paid $1,300 cash for this month's telephone bill.|
|30||Nozomi withdrew $2,300 cash from the company for personal use.|
The company's chart of accounts follows:
|106||Accounts Receivable||612||Depreciation Expense—Computer Equip.|
|124||Office Supplies||622||Salaries Expense|
|128||Prepaid Insurance||637||Insurance Expense|
|167||Computer Equipment||640||Rent Expense|
|168||Accumulated Depreciation—Computer Equip.||650||Office Supplies Expense|
|209||Salaries Payable||684||Repairs Expense|
|301||J. Nozomi, Capital||688||Telephone Expense|
|302||J. Nozomi, Withdrawals||901||Income Summary|
Use the following information:
- Two-thirds (or $144) of one month’s insurance coverage has expired.
- At the end of the month, $500 of office supplies are still available.
- This month’s depreciation on the computer equipment is $600.
- Employees earned $580 of unpaid and unrecorded salaries as of month-end.
- The company earned $2,450 of commissions that are not yet billed at month-end.
1. & 2. Prepare journal entries to record the transactions for April and post them to the ledger accounts in Requirement 6b. The company records prepaid and unearned items in balance sheet accounts.
3. Using account balances from Requirement 6b, prepare an unadjusted trial balance as of April 30.
4. Journalize the adjusting entries for the month and prepare the adjusted trial balance.
5a. Prepare the income statement for the month of April 30, 2017.
5b. Prepare the statement of owner's equity for the month of April 30, 2017.
5c. Prepare the balance sheet at April 30, 2017.
6a. Prepare journal entries to close the temporary accounts and then post to Requirement 6b.
6b. Post the journal entries to the ledger.
7. Prepare a post-closing trial balance.