Brief exercise 4-6 the income statement for weeping willow golf club

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Brief Exercise 4-6

The income statement for Weeping Willow Golf Club for the month ending July 31 shows Service Revenue $16,400, Salaries and Wages Expense $8,200, Maintenance and Repairs Expense $2,500, and Net Income $5,700.

 

Post the entries to the revenue and expense accounts, and complete the closing process for these accounts using the three-column form of account.

Service Revenue

Date

Explanation

Ref

Debit

Credit

Balance

7/31

Balance

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7/31

Closing entry

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Salaries and Wages Expense

         

Date

Explanation

Ref

Debit

Credit

Balance

7/31

Balance

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7/31

Closing entry

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Maintenance and Repairs Expense

         

Date

Explanation

Ref

Debit

Credit

Balance

7/31

Balance

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7/31

Closing entry

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Brief Exercise 4-9

At Creighton Company, the following errors were discovered after the transactions had been journalized and posted.

1.

A collection on account from a customer for $870 was recorded as a debit to Cash $870 and a credit to Service Revenue $870.

2.

The purchase of store supplies on account for $1,570 was recorded as a debit to Supplies $1,750 and a credit to Accounts Payable $1,750.


Prepare the correcting entries. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

No.

Account Titles and Explanation

Debit

Credit

1.

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2.

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Brief Exercise 4-11

Match each of the following accounts to its proper balance sheet classification.

Accounts

Balance Sheet Classification

Accounts Payable

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Accounts receivable

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Accumulated depreciation—buildings

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Buildings

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Cash

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Copyrights

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Income taxes payable

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Debt investments (long-term)

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Land

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Inventory

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Patents

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Supplies

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Exercise 4-7

Kay Magill Company had the following adjusted trial balance.

KAY MAGILL COMPANY
Adjusted Trial Balance
For the Month Ended June 30, 2014

Adjusted Trial Balance

Account Titles

Debit

Credit

Cash

$

 

Accounts Receivable

   

Supplies

   

Accounts Payable

$

 

Unearned Service Revenue

   

Owner’s Capital

   

Owner’s Drawings

   

Service Revenue

   

Salaries and Wages Expense

   

Miscellaneous Expense

   

Supplies Expense

   

Salaries and Wages Payable

   

 Total

$

$

 
       

Condition gt requires numbers instead of “null” and “0”

Prepare closing entries at June 30, 2014. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

No.

Account Titles and Explanation

Debit

Credit

1.

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(To close revenue account.)

     

2.

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(To close expense accounts)

     

3.

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(To close net income / (loss).)

     

4.

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(To close drawings)

     
 
         

Condition gt requires numbers instead of “null” and “0”

Prepare a post-closing trial balance.

KAY MAGILL COMPANY
Post-Closing Trial Balance
For the Month Ended June 30, 2014

Debit

Credit

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$http://edugen.wiley.com/edugen/art2/common/pixel.gif

$http://edugen.wiley.com/edugen/art2/common/pixel.gif

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 Total

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Exercise 4-8

Plevin Company ended its fiscal year on July 31, 2014. The company’s adjusted trial balance as of the end of its fiscal year is as shown below.

PLEVIN COMPANY
Adjusted Trial Balance
July 31, 2014

No.

Account Titles

Debit

Credit

101

Cash

$

 

112

Accounts Receivable

   

157

Equipment

   

158

Accumulated Depreciation—Equip.

$

 

201

Accounts Payable

   

208

Unearned Rent Revenue

   

301

Owner’s Capital

   

306

Owner’s Drawings

   

400

Service Revenue

   

429

Rent Revenue

   

711

Depreciation Expense

   

726

Salaries and Wages Expense

   

732

Utilities Expense

   

 Total

$

$

 
 
         

Condition gt requires numbers instead of “null” and “0”

Prepare the closing entries. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date

Account Titles and Explanation

Debit

Credit

July 31

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(To close revenue accounts.)

     

July 31

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(To close expense accounts.)

     

July 31

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(To close net income / ( loss).)

     

July 31

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(To close drawings.)

     
 
         

Condition gt requires numbers instead of “null” and “0”

Post to Owner’s Capital and Income Summary accounts. (Post entries in the order of journal entries presented in the previous part.)

Owner’s Capital

No. 301

Date

Explanation

Ref

Debit

Credit

Balance

July 31

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J15

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Income Summary

No. 350

   

Date

Explanation

Ref

Debit

Credit

Balance

July 31

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Condition gt requires numbers instead of “null” and “0”

Prepare a post-closing trial balance at July 31.

PLEVIN COMPANY
Post-Closing Trial Balance
July 31, 2014

Debit

Credit

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$http://edugen.wiley.com/edugen/art2/common/pixel.gif

$http://edugen.wiley.com/edugen/art2/common/pixel.gif

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 Total

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Exercise 4-10

Condition gt requires numbers instead of “null” and “0”

Janis Engle has prepared the following list of statements about the accounting cycle.

Identify each statement as true or false.

1.

“Journalize the transactions” is the first step in the accounting cycle.

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2.

Reversing entries are a required step in the accounting cycle.

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3.

Correcting entries do not have to be part of the accounting cycle.

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4.

If a worksheet is prepared, some steps of the accounting cycle are incorporated into the worksheet.

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5.

The accounting cycle begins with the analysis of business transactions and ends with the preparation of a post-closing trial balance.

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6.

All steps of the accounting cycle occur daily during the accounting period.

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7.

The step of “post to the ledger accounts” occurs before the step of “journalize the transactions.”

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8.

Closing entries must be prepared before financial statements can be prepared.

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