Department : Mechanical Engineering Subject : Accounting Note : Answer The Question Number '1'

1. a. Describe the advantage of trial balance. b. On August 1, 2019 Mark Spencer established Spencer's Travel Agency. During the month the following transactions occurred. Journalize the August transactions. 1. Invested $15,000 in cash in the agency. 2. Paid $600 for August rent on office expense. 3. Incurred $700 of advertising costs in the Morning Times, on account. 4. Performed service worth $10000: $3000 cash is received from customer, and the balance of $7000 is billed to customers on accounts. 5. Received $4000 in cash from customers who have previously been billed in transaction. 2. a. From the above information from question no. 2(B) open ledger accounts and post the August transactions. b. Prepare a trial balance at August 31, 2019. 3. a. Describe the need for adjusting entries. b. Write short note on the following terms: Accrued expenses, Book value, Depreciation, Unearned revenue, Useful life