On Jan 1, 2009 the following activitis occurred:
a) ICDI, a consulting services company, was orgainized and issed 10,000 shares of capita stock in exchange for $500,000 cash.
b)UCDI entered into an agreement with a landlord and paid $60,000 or 6 months rent in advance.
c) the company also purchased computer equiptment and furniture for $102,000 paying $32,000 cash and signing a 10% note due in 2 installments for the remaining balance - half due on Dec 31, 2009 and remainder on Dec31, 2010. intrest is payable quarterly commencing on March 31, 2009. The equiptment and furniture was determined to have a estimated useful life of 5 years.
d)UCDI hired a receptionis and a clerk with a combined salary of $1,500 per week for a 5 day work week. Salaries are paid on every friday and there are 4 fridays in January. January 31 nds on a wednesday.
e) the company also purchased supplies on account for a total of $18,000 from WGWUN Corp.
throughout th remainder of the month,the following event occurred:
f) UCDI entered into a contact with IKYCDI Corp t provide consulting serices over a 3 month period. IKYC paid $90,000 in advance to ensure UCDI's top talent was providing consulting service o ATW Corp during the month ofJan and billed ATW $10,000 on Jan 29.
On Jan 30, UCDI paid WGQYN Corp for the supples previousl yprovided.
at the end of the month, the following occurred:
i) management determined that $30,000 of consulting serviced ha been providedto IKYCDI and provided them with a statement summarizing the services provided.
j) UCDI determinded that there was $12,000 of supplies remaining on hand.
k) UCI paid a dividend to its stockholders of $25,000.
A- Prepare (i) the adjusting and closing journal enteries for the month-end January. Identify which journal enteries would be included in the Adjusted Trail Balance and the After-closing Trail Blance by playing A, or C,by each journal entry.
B- prepare the general ledger accounts (using T accounts) for all activity from Jan 1 to Jan 31, and the Adjusted Trial Balance. Use the letters indicated by each event above to distinguish entries in the T-accounts. Note: certain letters may have more than 1 event that needs to be recorded, add additional reference letters to distinguish one transaction recorded from another and provide a breif footnote explaination for each letter added.
C- prepare the balance sheet, income statement and statement of retained earnings as of January 31, 2009 and for the 1 month then ended.
Note : you are only being asked to journalize the adjusting and closing entries. while orginating enter do not need to be journalized, those events do need to be recorded in your general ledger
What part don't you understand?
What have you done so far to complete this assignment?
nothing, i truly have no idea how to do any of this. accounting is not my strong point. i have no idea how to make the adjusted trial balance with the information given, i really do not understand any of it and really need help :-/
Accounting isn't my field, but these sites may be able to help you, if you don't understand your text.
http://www.moneyinstructor.com/lesson/trialbalance.asp
http://blog.accountingcoach.com/what-is-an-adjusted-trial-balance/
http://www.toolkit.com/small_business_guide/sbg.aspx?nid=P06_1510
http://www.toolkit.com/small_business_guide/sbg.aspx?nid=P06_1580
http://books.google.com/books?id=AjRgpdhj5x4C&pg=PA75&lpg=PA75&dq=adjusting+and+closing+journal+entries&source=bl&ots=0D1Qq1tbf9&sig=msepEGIWYVlowrioRI14KEaazJg&hl=en&ei=uq_MSp2NKs6nlAfT46XhBQ&sa=X&oi=book_result&ct=result&resnum=4
http://www.ehow.com/way_5332021_accountancy-tutorial.html
To answer your question and help you prepare the required journal entries, general ledger accounts, and financial statements, I will break down the given information and explain the steps involved.
A) Adjusting and Closing Journal Entries:
1) To record the amortization of computer equipment and furniture (Event C):
Debit: Depreciation Expense - Computer Equipment and Furniture
Credit: Accumulated Depreciation - Computer Equipment and Furniture
2) To record the salary expense for the last week of January (Event D):
Debit: Salary Expense
Credit: Salary Payable
3) To record the supplies used during January (Event F):
Debit: Supplies Expense
Credit: Supplies
4) To recognize the revenue earned and the related services provided to IKYCDI (Event F and Event I):
Debit: Unearned Revenue
Credit: Service Revenue
5) To close the revenue and expense accounts to the Income Summary account:
Debit: Revenue accounts
Credit: Income Summary
Debit: Income Summary
Credit: Expense accounts
6) To close the Income Summary account to Retained Earnings:
Debit: Income Summary
Credit: Retained Earnings
B) General Ledger (T-Accounts):
Create the following T-accounts:
1) Cash
2) Capital Stock
3) Rent Expense
4) Prepaid Rent
5) Computer Equipment
6) Furniture
7) Accumulated Depreciation - Computer Equipment and Furniture
8) Notes Payable
9) Interest Payable
10) Salaries Payable
11) Supplies
12) Accounts Payable
13) Unearned Revenue
14) Service Revenue
15) Depreciation Expense - Computer Equipment and Furniture
16) Salary Expense
17) Supplies Expense
18) Income Summary
19) Retained Earnings
20) Dividends
Record the transactions for each account using the corresponding reference letters provided in the question. Add additional reference letters as necessary and provide brief explanations in footnotes.
C) Financial Statements:
1) Balance Sheet:
- List all assets, liabilities, and stockholders' equity accounts with their respective balances as of January 31, 2009.
- Calculate the total assets and total liabilities and stockholders' equity.
2) Income Statement:
- Calculate the net income by subtracting the total expenses from the total revenues for the month.
3) Statement of Retained Earnings:
- Start with the beginning balance of retained earnings.
- Add net income.
- Subtract dividends.
- Calculate the ending balance of retained earnings.
Note: The specific amounts and calculations are not provided in your question. You will need to refer to the given information to determine the amounts to be recorded in the journal entries, T-accounts, and financial statements.
Remember, accounting is an iterative process, and the information provided should be used as a guide to complete the required tasks. It is always important to refer to relevant accounting principles and guidelines when preparing financial statements.