Problem No.

1
Gray Electronic Repair Services
Unadjusted Trial Balance
December 31, 2014
Account Title
Cash
Accounts Receivable
Service Supplies
Furniture and Fixtures
Service Equipment
Accounts Payable
Loans Payable
Mr. Gray, Capital
Mr. Gray, Drawing
Service Revenue
Rent Expense
Salaries Expense
Taxes and Licenses
Totals

Debit $
7,480.00
3,400.00
1,500.00
3,000.00
16,000.00

Credit $

9,000.00
12,000.00
13,200.00
7,000.00
9,550.00
1,500.00
3,500.00
370.00
$ 43,750.00

$ 43,750.00

At the end of the period, the following adjusting entries were made:
Dec 31Accounts Receivable 300.00
Service Revenue
300.00
31 Utilities Expense
1,800.00
Utilities Payable
1,800.00
31Service Supplies Expense 900.00
Service Supplies
900.00
31Depreciation Expense
720.00
Accumulated Depreciation

720.00

Ans: Adjusted Trial Balance=$ 46,570.00

Note: Prepare Adjusted Trial Balance, Income Statement and Balance Sheet.

Problem No.2
Company A was incorporated on January 1, 2010 with an initial capital of 5,000. During the first month of its
operations, the company engaged in following transactions:
Date
Jan 2
Jan 3
Jan 4
Jan 13
Jan 13
Jan 14
Jan 18

Transactions
An amount of $36,000 was paid as advance rent for three months.
Paid $60,000 cash on the purchase of equipment costing $80,000. The remaining amount was recognized
as a one year note payable with interest rate of 9%.
Purchased office supplies costing $17,600 on account.
Provided services to its customers and received $28,500 in cash.
Paid the accounts payable on the office supplies purchased on January 4.
Paid wages to its employees for first two weeks of January, aggregating $19,100.
Provided $54,100 worth of services to its customers. They paid $32,900 and promised to pay the
remaining amount.

Jan 23
Jan 25
Jan 26
Jan 28
Jan 31
Jan 31
Jan 31
Jan 31

Received $15,300 from customers for the services provided on January 18.
Received $4,000 as an advance payment from customers.
Purchased office supplies costing $5,200 on account.
Paid wages to its employees for the third and fourth week of January: $19,100.
Paid $5,000 as dividends expenses.
Received electricity bill of $2,470.
Received telephone bill of $1,494.
Miscellaneous expenses paid during the month totaled $3,470

Relevant information for the preparation of adjusting entries of Company A:

1. Office supplies having original cost $4,320 were unused till the end of the period.
2. Prepaid rent of $36,000 was paid for the months January, February and March.
3. The equipment costing $80,000 has useful life of 5 years and its estimated salvage value is $14,000.
Depreciation is provided using the straight line depreciation method. The Depreciation expense is $1100.
4. The interest rate on note payable is 9%. Accrued the interest for one month.
5. $3,000 worth of service has been provided to the customer who paid an advance amount of $4,000.
Note: You are required to Prepare the Complete Accounting Cycle.
Unadjusted Trial Balance=215,564

Adjusted Trial Balance=$ 217,014

Problem No.3
During its first month of operation, the Flower Landscaping Corporation, specializes in residential landscaping,
Completed the following transactions.
March 1
March 1
March 1
March 7
March 10
March 14

Began business by $72,000 aggregated of personal resources and others resources.

Paid the current month's rent, $4,500.
Paid the premium on a 1-year insurance policy, $3,300.
Purchased supplies on account from Parkview Company, $900.
Paid employee salaries, $2,200.
Purchased equipment from Hammond Company, $9,000. Paid $1,500 down and the balance was
placed on account. Payments will be $375.00 per month for 20 months. The first payment is due

4/1.
March 15
March 19
March 31
March 31

Note: Use accounts payable for the balance due.

Received cash for landscaping revenue for the first half of March, $4,896.
Made payments on account to Parkview Company, $450.
Received cash for landscaping revenue for the last half of March, $5,304.
Paid cash dividend of $1,000.

Following adjusting entries were made during the period.

a) One month's insurance has expired.
b) The remaining inventory of supplies is $475.
c) The estimated depreciation on equipment is $150.
d) The estimated income taxes are $795.
Note: You are required to prepare the Complete Accounting Cycle.
Unadjusted Trial Balance=90,150

Unadjusted Trial Balance=91,095

By: Hamza Saleem