himanshukhasa2001

For the past several years, Emily Page has operated a part-time consulting business from her home. As of June 1, 2010, Emily decided to move to rented quarters and tooperate the business, which was to be known as Bottom Line Consulting, on a full-timebasis. Bottom Line Consulting entered into the following transactions during June:

June 1. The following assets were received from Emily Page: cash, $20,000; accounts receivable, $4,500; supplies, $2,000; and office equipment, $11,500. There were no liabilities received.

1. Paid three months’ rent on a lease rental contract, $6,000.
2. Paid the premiums on property and casualty insurance policies, $2,400.
3. Received cash from clients as an advance payment for services to be provided and recorded it as

unearned fees, $2,700.

1. Purchased additional office equipment on account from Office Depot Co., $3,500.
2. Received cash from clients on account, $3,000.
3. Paid cash for a newspaper advertisement, $200.
4. Paid Office Depot Co. for part of the debt incurred on June 5, $750.
5. Recorded services provided on account for the period June 1–12, $5,100.
6. Paid part-time receptionist for two weeks’ salary, $1,100.
7. Recorded cash from cash clients for fees earned during the period June 1–16, $6,500.
8. Paid cash for supplies, $750.
9. Recorded services provided on account for the period June 13–20, $3,100.
10. Recorded cash from cash clients for fees earned for the period June 17–24, $5,150.
11. Received cash from clients on account, $6,900.
12. Paid part-time receptionist for two weeks’ salary, $1,100.
13. Paid telephone bill for June, $150.
14. Paid electricity bill for June, $400.
15. Recorded cash from cash clients for fees earned for the period June 25–30, $2,500.
16. Recorded services provided on account for the remainder of June, $1,000.
17. Emily withdrew $5,000 for personal use.

Instructions

1. Journalize each transaction in a two-column journal, referring to the following chartof accounts in selecting the accounts to be debited and credited. (Do not insert theaccount numbers in the journal at this time.)

11 Cash                                                31 Emily Page, Capital

12 Accounts Receivable                        32 Emily Page, Drawing

14 Supplies                                           41 Fees Earned

15 Prepaid Rent                                    51 Salary Expense

16 Prepaid Insurance                             52 Rent Expense

18 Office Equipment                             53 Supplies Expense

19 Accumulated Depreciation                 54 Depreciation Expense

21 Accounts Payable                             55 Insurance Expense

22 Salaries Payable                               59 Miscellaneous Expense

23 Unearned Fees

1. Post the journal to a ledger of four-column accounts.
2. Prepare an unadjusted trial balance.
3. At the end of June, the following adjustment data were assembled. Analyze and use these data to

complete parts (5) and (6).

1. Insurance expired during June is $200.
2. Supplies on hand on June 30 are $650.
3. Depreciation of office equipment for June is $250.
4. Accrued receptionist salary on June 30 is $220.
5. Rent expired during June is $2,000.
6. Unearned fees on June 30 are $1,875.
7. Journalize and post the adjusting entries.
8. Prepare an adjusted trial balance.
9. Prepare an income statement, a statement of owner’s equity, and a balance sheet.
10. Prepare and post the closing entries. (Income Summary is account #33 in the chart of accounts.)

Indicate closed accounts by inserting a line in both the Balance columns opposite the closing entry.

1. Prepare a post-closing trial balance.

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