As your team lead explained, you will prepare a set of journal entries and record them appropriately for your client. In addition to individually recording each journal entry, you will also need to ensure internal consistency across the financial statements (that is, if you make an update on the balance sheet, check to see if you need to make an update on the income statement or cash flow statement as well).

Your team lead has provided you with an email list of the clients transactions for the quarter, as well as the following financial statements for the quarter ended March 31, 2021:

I am following up on the client we discussed earlier today in our huddle. Running coaches and friends Dash, Sprint, and Bolt just bought a coaching company and gym, called Run Forever, from their friend, Speed. Theyve been the owners for the last quarter, but have no idea how to keep track of their business transactions and activities. Theyd like to buy a new treadmill for their gym, but dont know if they have the cash to do it. They did jot down all the money they spent and all the money they received for the last quarter: 1. Paid Speed $200,000 to purchase the business 2. Each owner put $10,000 into the company bank account as Contributed Capital on April 1, 2021 3. Paid rent for April, May, June, on the first of each month; and prepaid for July on June 30, 2021, at $3,000 per month 4. Collected $17,000 in cash for coaching services from clients who pay at the end of each session 5. Charged $11,000 on client credit cards for coaching services from clients who pay at the end of each session; still awaiting payout from credit card companies 6. Collected $5000 from credit card companies for coaching services that were previously paid by clients on credit card at the end of each session 7. Collected $6,000 in cash from clients who signed up for a pack of 10 coaching sessions. Of these clients, half of the sessions remain to be used, even though the clients have already paid Run Forever the cash 8. Purchased a new spin bike for the gym for $1000 on May 1, 2021. The bike has a useful life of 3 years 9. Used supplies throughout the quarter (paper towels, sanitizer, disposal masks). Did not keep track of the supplies used, but you went and checked their inventory and calculated that about $1,800 of supplies is still left 10. Did not pay or record salaries for themselves, totaling $60,000 for the quarter 11. Paid salaries for two coaches on June 30, 2021, totaling $10,000 12. Insurance on the gym was prepaid by the previous owner for the entire 12 months starting January 1, 2021. Three months passed this quarter under the new owners. 13. Paid off a balance of $7,000 that had been owed on previously purchased weights and benches with a local supplier, leaving the company with no outstanding debt. They also gave us financial statements created by the previous owner for the quarter ended March 31, 2021, just before they bought the company on April 1, 2021. Your Team Lead.

Record the list of transactions as journal entries and prepare a new set of financial statements for the current period that include the additional entries from the client. Complete the following tasks in Excel:

• Prepare journal entries to record the effect of the transactions and activities listed in the email. Indicate whether each entry is a regular journal entry or an adjusting journal entry. If it is an adjusting journal entry, what makes it so?
• Revise the financial statements after the journal entries are posted. Be sure that all financial information is consistent across all statements.