During March, The Following Transactions Were Completed

Question

During March The Following Transactions Were Completedmarch 1 During March the following transactions were completed. March 1- Issued common stock for $20,000 cash March 2- Purchased used van for $16,000, paying $2,000 cash and the remainder on account. March 3- Purchased cleaning supplies for $1,200 on account. March 4- Paid $7,200 cash for one year of rent in advance. (effective March 1) March 12- Preformed cleaning services and billed customers $5,400. March 14- Paid $6,000 on the amount owed for the van and $800 on the amount owed for supplies. March 18- Paid $3,300 for employee salaries. March 21- Received $4,000 from customers billed on March 12. March 22- Paid $300 for van repairs. March 24- Received $5,800 cash for cleaning services provided to customers. March 31- Declared and paid $1,200 cash dividend. The chart of accounts contains: Cash, Accounts Receivable, Supplies, Prepaid Rent, Equipment, Accumulated Depreciation-Equipment, Accounts Payable, Salaries Payable, Common Stock, Retained Earnings, Dividends, Service Expense, Depreciation Expense. 1) Record each transaction in a journal. 2) post each transaction to the appropriate T-account. 3) Calculate the balance of each account as of March 31st. 4) Prepare a trial balance at March 31st. 5) Record the following adjustments in the journal: A) Services provided but unbilled at March 31st were $1,300 B) Depreciation on the van was $400 for the month. C) One month of rent expired. D) Unused supplies of $300 remained at March 31st. E) Accrued but unpaid salaries were $2,900 at March 31st. 6) Post the adjusted balance of each account. 7) Calculate the adjusted balance of each account. 8) Prepare an adjusted trial balance. 9) Prepare an income statement and a statement of stockholders' equity for March and a classified balance sheet at March 31st.

Dr. Jack HW Helper · Accepted Answer

The financial activities of a company during a specific period are critical in understanding its economic health and operational efficiency. This case study analyses the transactions occurred in March for a fictional company, focusing on journal entries, T-accounts, trial balances, adjustments, and the preparation of financial statements. The comprehensive approach ensures the accurate reflection of financial position and results, conforming to accounting principles and standards. Introduction Accounting is a systematic process of recording, classifying, and summarizing financial transactions to provide meaningful insights into a company's performance. The scenario presented involves diverse transactions, including equity issuance, purchases, service revenues, payments, and dividends, each impacting financial statements in specific ways. The detailed record-keeping and adjustments further enhance the accuracy and reliability of financial reporting, essential for stakeholders’ decision-making. Journalization of Transactions Each transaction during March is recorded in the journal entries, capturing the dual effect on the accounts based on the double-entry bookkeeping system. For example, the issuance of common stock increases cash and common stock accounts. Purchasing a van involves both asset and liability accounts. Billing customers increases accounts receivable and service revenue, while cash collections reduce receivables and increase cash. Notably, the transaction on March 4, paying rent in advance, debits prepaid rent; the purchase of supplies on March 3 increases supplies and accounts payable; the billings on March 12 increase accounts receivable and service revenue; and subsequent payments like salaries, repairs, and dividends affect respective accounts. Posting to T-Accounts and Trial Balance Postings from the journal entries into T-accounts facilitate visualization of account balances. The process involves recording debits on the left and credits on the rig

During March, The Following Transactions Were Completed

During March The Following Transactions Were Completedmarch 1

Paper For Above instruction

Introduction

Journalization of Transactions

Posting to T-Accounts and Trial Balance

Adjusting Entries

Post-Adjustment and Financial Statements

Conclusion

References