Matthews Delivery Service, Inc., completed the following transactions during its first month of operations for January 2012:
Matthews Delivery Service, Inc., completed the following transactions during its first month of operations for January 2012:
a.Matthews Delivery Service, Inc., began operations by receiving $6,000 cash and a truck valued at $11,000. The business issued common stock to aquire these assets. b.Paid $300 cash for supplies.
c.Prepaid insurance, $700.
d.Performed delivery services for a customer and received $800 cash.
e.Completed a large delivery job, billed the customer $1,500, and received apromise to collect the $1,500 within one week.
f.Paid employee salary, $700.
g.Received $12,000 cash for performing delivery services.
h.Collected $600 in advance for delivery service to be performed later.
i.Collected $1,500 cash from a customer on account.
j.Purchased fuel for the truck, paying $200 with a company credit card. (CreditAccounts payable)
k.Performed delivery services on account, $900.l.Paid office rent, $600. This rent is not paid in advance.
m.Paid $200 on account.
n.Paid cash dividends of $2,100.
Requirements
1. Record each transaction in the journal. Key each transaction by its letter. Explanations are not required.
2. Post the transactions that you recorded in Requirement 1 in the T-accounts. Cash Accounts receivable, Supplies, Prepaid insurance, Delivery truck, Accumulated depreciation, Accounts payable, Salary payable, Unearned service revenue, Common stock, Retained earnings, Dividends, Income summary, Service revenue, Salary expense, Depreciation expense, Insurance expense, Fuel expense, Rent expense, Supplies expense
3. Enter the trial balance in the worksheet for the month ended January 31, 2012.Complete the worksheet using the adjustment data given at January 31. a.Accrued salary expense, $700.
b.Depreciation expense, $60.
c.Prepaid insurance expired, $250.
d.Supplies on hand, $200.e.Unearned service revenue earned during January, $500.
4. Prepare Matthews Delivery Services income statement and statement of retained earnings for the month ended January 31, 2012, and the classified balance sheeton that date. On the income statement, list expenses in decreasing order by amount that is, the largest expense first, the smallest expense last.
5. Journalize and post the adjusting entries beginning with a.
6. Journalize and post the closing entries.
7. Prepare a post-closing trial balance at January 31, 2012.