T-Accounts, Adjusting & Closing Entries, Trial Balance and Financial Statements Exercise
Οn October 1, 20xx, Jason Dauphinais opened Dauphinais Appliance Serνice. During the month, he completed the following transactions for the company:
Oct. 1. Began business by depositing €5,000 in a bank account.
1. Paid the rent for a store for one month, €425.
1. Paid the premium on a one-year insurance policy, €480.
2. Purchased repair equipment from Fιtzgerald Company, €4,200. Terms were €600 down (cash) and €300 per month for one year. First payment is due November 1.
5. Purchased repair supplies from Deane Company on credit, €468.
8. Paid cash for an advertisement in a local newspaper, €60.
15. Received cash repair revenue for the first half of the month, €400.
21. Paid Deane Company οn account, €225.
31. Received cash repair revenue for the second half of October, €975.
31. Withdrew cash for personal expenses, €300.
1. Prepare entries in T accounts form to record the October transactions.
2. Using the fol1owing information, record adjusting entries (use T accounts):
a. One month's insurance has expired.
b. The remaining inventory of unused repair supplies is €169.
c. The estimated depreciation on repair equipment is €70.
3. From the T accounts in the ledger, prepare an adjusted trial balance: (Note: Normally a trial balance is prepared before adjustments but is omitted here to save time.)
4. From the adjusted trial balance, prepare an income statement, a statement of owner's equity, and a balance sheet for October ending date.
5. Prepare closing entries in T accounts.