The following events apply to your company’s first year of operations:

1. January 1, 2021 - Acquired $20,000 cash from the issue of common stock.
2. January 1, 2021 - Purchased $800 of supplies on account.
3. January 1, 2021 – Purchased a truck for $10,000 cash. Salvage value is $2,000. Useful life is 4 years.
4. January 15, 2021 - Paid $4,200 cash in advance for a one-year lease on office space starting February 1, 2021.
5. March 31, 2021 - Earned $28,000 of revenue on account.
6. March 31, 2021 - Incurred $12,500 of other operating expenses on account.
7. March 31, 2021 - Collected $24,000 cash from accounts receivable.
8. March 31, 2021 - Paid $9,000 cash on accounts payable.
9. April 1, 2021 borrowed $10,000 from the bank on a 6 month Note Payable with a 10% interest rate.
10. June 30, 2021 Paid a $3,000 cash dividend to the stockholders.

The Stockholders would like to see how your company is performing in the first 6 months of operation and have asked for a complete set of Financial Statements for the period 01/01/2021 – 06/30/2021. Prepare the period end adjusting journal entries noted below, but keep in mind this is for 6 months of operation.

Information for Adjusting Entries – all should be dated June 30, 2021.

1. There was $150 of supplies on hand at the end of June 2021.
2. The lease on the office space covered a one-year period beginning February 1, 2021.
3. There was $3,600 of accrued salaries at the end of the period.
4. Your company estimates uncollectable accounts receivable as 1% of sales on account. (You may have to choose a “customer” for your entry. Select “Complete Business Service” or another option that will allow you to post the journal entry.)
5. Record Depreciation on the truck purchased on January 1, 2021.
6. Record interest expense for the Note Payable dated April 1, 2021. Interest will be paid when the note is due.

Answer rating: 100% (QA)

Company Journal Enteries Worksheet Trans Particulars Debit in Credit in For the period ending 306202... View the full answer