Problem
Salem Company started its operations on January 1, 2016. The following transactions took place during the first month of operations:
Jan 1: Salem invests $480,000 cash to start the business.
Jan 5: Purchased furniture for $72,000, paying $18,000 in cash and sign a note for the remaining balance.
Jan 8: Purchased supplies for $3,600 on credit.
Jan 12: Paid $6,300 cash for January rent.
Jan 18: Paid $1,800 cash for office supplies purchased on January 8.
Jan 24: Services billed to customers amount to $36,000.
Jan 25: Received utility bills for $5,400 for the month of January.
Jan 27: Paid $19,800 cash for salaries.
Jan 29: Received $27,000 cash from customers in payment for services billed on January 24.
Jan 31: Salem withdrew $10,100 from the business for personal use.
Required:
1- Prepare Journal entries to record the above transactions.
2- Post to the appropriate ledger accounts.
3- Prepare the trial balance.
4- Prepare financial statements for the month.