Prepare a chart of accounts as required and journalize the following transactions and post to the general ledger. (note: general ledger here can be expressed as a T account)

TRANSACTIONS

• On March 1^st Fancy Pants sold 1,000 common shares for $12,000 start the business.
• On March 2^nd Fancy Pants took out a $3,000 loan from “TD Bank”.  Fancy Pants agreed to repay the loan in one year plus 8% interest.
• On March 3^rd Fancy Pants purchased some computer equipment to help run the business for $4,500 cash.
• March 4^th Fancy Pants purchased a six month insurance policy for $1,200 cash.
• March 6^th Fancy Pants purchased $6,500 worth of Suits and Tuxedos from Big Lots Wholesaler on credit with payment due in 30 days.
• March 10^th Fancy Pants makes a cash sale to “Luxury Restaurants” for $8,800.  Fancy Pants had paid $2000 for the suits they sold.
• On March 15^th Fancy Pants makes a credit sale to another client for $3,300.  The suits for this sale had cost fancy pants $1,000.  Payment is also due in 30 days.
• On March 19^th Fancy Pants received $9,000 advance payment for a new style of tuxedos to be worn by waiters at “HighEnd Restaurants”. Fancy Pants required the advance as part of the sale to ensure they secure enough inventory of the new style.
• March 23^rd Fancy Payments makes an early payment in the amount of $6,000 to Big Lots Wholesaler.
• March 26^th Fancy Pants paid weekly employee salaries of $1,800.
• March 29^th Fancy Pants receives $3,000 for the sale made on March 15^th.
• March 30^th fancy Pants paid its utility bill of $2,200 for the month of March.

Part B)

It is now March 31^st and management at Fancy Pants has decided to make March 31^st their year end. While only one month of transactions have been recorded, as Fancy Pants accountant, you must now perform the required adjusting entries for the year end and prepare the financial statements.

1.)  Review through the above transaction and prepare any required adjusting entries for March 31.

Some additional information includes:

• Equipment is expected to last 5 years.
• A work week is 5 days. Between March 26 and March 31employees have worked for three days.

2.) Prepare a statement of retained earnings 

3.) prepare the closing entries

Answer rating: 100% (QA)

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