Homework SourseJohnson Graphics Company was organized on January 1 2017 by
Johnson Graphics Company was organized on January 1, 2017, by Cameron Johnson. At the end of the first 6 months of operations, the trial balance contained the accounts shown below.
Analysis reveals the following additional data.
Depreciation is $2,250 per year.
1. Journalize the adjusting entries at June 30. (Assume adjustments are recorded every 6 months.) (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)
2. Prepare an adjusted trial balance.
3. Prepare an income statement for the 6 months ended June 30.
4. Prepare an owner’s equity statement for the 6 months ended June 30 and balance sheet (at June 30).
List of Accounts:
Accounts Payable
Accounts Receivable
Accumulated Depreciation-Buildings
Accumulated Depreciation-Equipment
Advertising Expense
Buildings
Cash
Depreciation Expense
Equipment
Insurance Expense
Interest Expense
Interest Payable
Land
Maintenance and Repairs Expense
Mortgage Payable
No Entry
Notes Payable
Owner\'s Capital
Owner\'s Drawings
Prepaid Advertising
Prepaid Insurance
Prepaid Rent
Rent Expense
Rent Revenue
Salaries and Wages Expense
Salaries and Wages Payable
Sales Revenue
Service Revenue
Subscription Revenue
Supplies
Supplies Expense
Ticket Revenue
Unearned Rent Revenue
Unearned Service Revenue
Unearned Subscription Revenue
Unearned Ticket Revenue
Utilities Expense
Please help with as much as allowed. Please include any necessary calculations.
| Debits | Credits | |||||
| Cash | $ 8,600 | Notes Payable | $ 20,000 | |||
| Accounts Receivable | 14,000 | Accounts Payable | 9,000 | |||
| Equipment | 45,000 | Owner’s Capital | 22,000 | |||
| Insurance Expense | 2,700 | Sales Revenue | 52,100 | |||
| Salaries and Wages Expense | 30,000 | Service Revenue | 6,000 | |||
| Supplies Expense | 3,700 | |||||
| Advertising Expense | 1,900 | |||||
| Rent Expense | 1,500 | |||||
| Utilities Expense | 1,700 | |||||
| $109,100 | $109,100 |
Solution
Johnson Graphics Company Adjustment entries date Account\'s tittle Debit $ Credit $ 1 Supplies 1,500 Supplies expenses 1,500 2 Interest expenses ( $ 20,000 x 9% x 5/12 ) 750 Interest Payable 750 ( 5 months interest on note payable at 9% ) 3 Prepaid insurance ( $ 2,700 x 8/12 ) 1,800 Insurance expenses 1,800 ( transfer of 8 months insurance premium to prepaid account ) 4 Service revenue 1,300 Unearned service revenue 1,300 5 Accounts receivable 2,000 Service revenue 2,000 6 Depreciation expenses 2,250 Accumulated depreciation-Equipment 2,250 Johnson Graphics Company Income Statement For the period ending June 30,2017 $ $ Sales Revenue 52,100 Service Revenue ( $ 6,000 + $ 2,000 - $ 1,300 ) 6,700 Total revenue ( A) 58,800 Operating expenses; Salaries and Wages Expense 30,000 Insurance Expense ( $ 2,700 - $ 1,800 ) 900 Supplies Expense ( $ 3,700 - $ 1,500 ) 2,200 Advertising Expense 1,900 Rent Expense 1,500 Utilities Expense 1,700 Interest expenses 750 Depreciation expenses 2,250 Total operating expenses ( B ) 41,200 Net income ( A ) - ( B ) 17,600 Johnson Graphics Company Owner\'s Equity Statement as at June 30,2017 $ Owner’s Capital 22,000 Add: Net income 17,600 Ending balance of owner\'s equity 39,600 Johnson Graphics Company Balance sheet as at June 30,2017 Owner\'s equity and liabilities $ $ Owner\'s Equity 39,600 Note Payable 20,000 Current liabilities; Accounts Payable 9,000 Interest Payable 750 Unearned service revenue 1,300 TOTAL 70,650 Assets $ $ Equipment 45,000 Less: Accumulated depreciation-equipment (2,250) Fixed asset ( Net) 42,750 Current assets; Cash 8,600 Accounts Receivable ( $ 14,000 + $ 2,000 ) 16,000 Supplies 1,500 Prepaid insurance 1,800 TOTAL 70,650
