On August 1, 2017, Delanie Tugut began a tour company in the Northwest Territories called Tugut Arctic Tours. The following occurred during the first month of operations:
Aug.    

1. Purchased office furniture on account; $5,200. 

1. Delanie Tugut invested $7,000 cash into her new business. 

2. Collected $3,900 in advance for a three-week guided caribou hunt beginning the last week of August. 

3. Paid $6,000 for six months’ rent for office space effective August 1. 

4. Received $3,000 for a four-day northern lights viewing tour just completed. 

7. Paid $1,500 for hotel expenses regarding the August 4 tour.
15. Delanie withdrew cash of $500 for personal use. 

22. Met with a Japanese tour guide to discuss a $150,000 tour contract. 

31. Paid wages of $1,300.

Required
1. Prepare general journal entries to record the August transactions.
2. Set up the following T-accounts: Cash (101); Prepaid Rent (131); Office Furniture (161); Accumu- lated Depreciation, Office Furniture (162); Accounts Payable (201); Unearned Revenue (233); Delanie Tugut, Capital (301); Delanie Tugut, Withdrawals (302); Revenue (401); Depreciation Expense, Office Furniture (602); Wages Expense (623); Rent Expense (640); Telephone Expense (688); and Hotel Expenses (696).
3. Post the entries to the accounts; calculate the ending balance in each account. 

4. Prepare an unadjusted trial balance at August 31, 2017. 

5. Use the following information to prepare and post adjusting entries on August 31:
a. The office furniture has an estimated life of four years and a $208 residual value. 

b. Two-thirds of the August 2 advance has been earned. 

c. One month of the Prepaid Rent has been used. 

d. The August telephone bill was not received as of August 31 but amounted to $320.
6. Prepare an adjusted trial balance.

7. Prepare an income statement, a statement of changes in equity, and a balance sheet.
Analysis Component: When a company shows revenue on its income statement, does this mean that cash equal to revenues was received during the period in which the revenues were reported?