Laura Eddy opened Eddy’s Carpet Cleaners on March 1. During March, the following transactions were completed.
Mar. 1 Invested $10,377 cash in the business.
1 Purchased used truck for $6,120, paying $3,060 cash and the balance on account.
3 Purchased cleaning supplies for $1,176 on account.
5 Paid $1,752 cash on one-year insurance policy effective March 1.
14 Billed customers $4,870 for cleaning services.
18 Paid $1,664 cash on amount owed on truck and $414 on amount owed on cleaning supplies.
20 Paid $1,940 cash for employee salaries.
21 Collected $1,497 cash from customers billed on March 14.
28 Billed customers $2,646 for cleaning services.
31 Paid gas and oil for month on truck $214.
31 Withdrew $708 cash for personal use.
The chart of accounts for Eddy’s Carpet Cleaners contains the following accounts: No. 101 Cash, No. 112 Accounts Receivable, No. 128 Cleaning Supplies, No. 130 Prepaid Insurance, No. 157 Equipment, No. 158 Accumulated Depreciation-Equipment, No. 201 Accounts Payable, No. 212 Salaries Payable, No. 301 L. Eddy, Capital, No. 306, L. Eddy, Drawing, No. 350 Income Summary, No. 400 Service Revenue, No. 633 Gas & Oil Expense, No. 634 Cleaning Supplies Expense, No. 711 Depreciation Expense, No. 722 Insurance Expense, and No. 726 Salaries Expense
Journalize the March transactions. Use page J1 for the journal. (For multiple debit/credit entries, list amounts from largest to smallest eg 10, 5, 3, 2. If amounts are the same, list alphabetically.)
General Journal
J1
Date Account/Description Debit Credit
Mar. 1
Mar. 1
Mar. 3
Mar. 5
Mar. 14
Mar. 18
Mar.20
Mar. 21
Mar. 28
Mar. 31
Mar. 31
Prepare a trial balance at March 31 on a worksheet. Enter the following adjustments on the worksheet and complete the worksheet. (If answer is zero, please enter 0. Do not leave any fields blank.)
Earned but unbilled revenue at March 31 was $638.
Depreciation on equipment for the month was $263.
One-twelfth of the insurance expired.
An inventory count shows $394 of cleaning supplies on hand at March 31.
Accrued but unpaid employee salaries were $503.
EDDY’S CARPET CLEANERS
Worksheet
For the Month Ended March 31, 2010
Trial Balance
Adjustments
Adjusted Trial Balance
Income Statement
Balance Sheet
Account Titles Dr. Cr. Dr. Cr. Dr. Cr. Dr. Cr. Dr. Cr.
Cash
Accounts Receivable
Cleaning Supplies
Prepaid Insurance
Equipment
Accounts Payable
L. Eddy, Capital
L. Eddy, Drawings
Service Revenue
Gas & Oil Expense
Salaries Expense
Totals
Depreciation Expense
Accumulated Depreciation
Insurance Expense
Cleaning Supplies Expense
Salaries Payable
Totals
Net Income
Totals
Prepare the income statement and owner’s equity statement for March and a classified balance sheet at March 31. (List amounts from largest to smallest eg 10, 5, 3, 2. List assets in order of liquidity and liabilities from largest to smallest eg 10, 5, 3, 2. If answer is zero, please enter 0. Do not leave any fields blank.)
EDDY’S CARPET CLEANERS
Income Statement
Revenues
$
Expenses
$
Total expenses
Net income
$
EDDY’S CARPET CLEANERS
Owner’s Equity Statement
$
Add:
Less:
$
EDDY’S CARPET CLEANERS
Balance Sheet
Assets
Current Assets
$
Total current assets
Property, plant and equipment
$
:
Total assets
$
Liabilities and Owner’s Equity
Current liabilities
$
Total current liabilities
Owner’s Equity
Total liabilities and owner’s equity
$
Journalize adjusting entries. Use page J2 for the journal.
General Journal
J2
Date Account/Description Debit Credit
Mar. 31
(To adjust accounts receivable.)
Mar. 31
(To adjust depreciation.)
Mar. 31
(To adjust insurance.)
Mar. 31
(To adjust cleaning supplies.)
Mar. 31
(To adjust salaries.)
Journalize the closing entries. Use page J3 for the journal. (For multiple debit/credit entries, list amounts from largest to smallest eg 10, 5, 3, 2.)
General Journal
J3
Date Description/Account Debit Credit
Mar. 31
(To close revenue account.)
Mar. 31
(To close expense accounts.)
Mar. 31
(To close net income.)
Mar. 31
(To close drawings.)
Post the March transactions and adjusting entries using the three-column form of account. Post the closing entries and complete the closing process. (If answer is zero, please enter 0. Do not leave any fields blank.)
Cash
No. 101
Date
Explanation
Ref.
Debit
Credit
Balance
Mar. 1 J1
1 J1
5 J1
18 J1
20 J1
21 J1
31 J1
31 J1
Accounts Receivable
No. 112
Date
Explanation
Ref.
Debit
Credit
Balance
Mar. 14 J1
21 J1
28 J1
31 Adjusting J2
Cleaning Supplies
No. 128
Date
Explanation
Ref.
Debit
Credit
Balance
Mar. 3 J1
31 Adjusting J2
Prepaid Insurance
No. 130
Date
Explanation
Ref.
Debit
Credit
Balance
Mar. 5 J1
31 Adjusting J2
Equipment
No. 157
Date
Explanation
Ref.
Debit
Credit
Balance
Mar. 1 J1
Accumulated Depreciation – Equipment
No. 158
Date
Explanation
Ref.
Debit
Credit
Balance
Mar. 31 J2
Accounts Payable
No. 201
Date
Explanation
Ref.
Debit
Credit
Balance
Mar. 1 J1
3 J1
18 J1
Salaries Payable
No. 212
Date
Explanation
Ref.
Debit
Credit
Balance
Mar. 31 Adjusting J2
L. Eddy, Capital
No. 301
Date
Explanation
Ref.
Debit
Credit
Balance
Mar. 1 J1
31 Closing J3
31 Closing J3
L. Eddy, Drawing
No. 306
Date
Explanation
Ref.
Debit
Credit
Balance
Mar. 31 J1
31 Closing J3
Income Summary
No. 350
Date
Explanation
Ref.
Debit
Credit
Balance
Mar. 31 Closing J3
31 Closing J3
31 Closing J3
Service Revenue
No. 400
Date
Explanation
Ref.
Debit
Credit
Balance
Mar. 14 J1
28 J1
31 Adjusting J2
31 Closing J3
Gas & Oil Expense
No. 633
Date
Explanation
Ref.
Debit
Credit
Balance
Mar. 31 J1
31 Closing J3
Cleaning Supplies Expense
No. 634
Date
Explanation
Ref.
Debit
Credit
Balance
Mar. 31 Adjusting J2
31 Closing J3
Depreciation Expense
No. 711
Date
Explanation
Ref.
Debit
Credit
Balance
Mar. 31 Adjusting J2
31 Closing J3
Insurance Expense
No. 722
Date
Explanation
Ref.
Debit
Credit
Balance
Mar. 31 Adjusting J2
31 Closing J3
Salaries Expense
No. 726
Date
Explanation
Ref.
Debit
Credit
Balance
Mar. 20 J3
31 Adjusting J3
31 Closing J3
Prepare a post-closing trial balance at March 31. (If answer is zero, please enter 0. Do not leave any fields blank.)
EDDY’S CARPET CLEANERS
Post-Closing Trial Balance
March 31, 2010
Trial Balance
Account Titles Dr. Cr.
Cash $ $
Accounts Receivable
Cleaning Supplies
Prepaid Insurance
Equipment
Accumulated Depreciation
Accounts Payable
Salaries Payable
L. Eddy, Capital
L. Eddy, Drawings
Service Revenue
Gas & Oil Expense
Salaries Expense
Depreciation Expense
Insurance Expense
Cleaning Supplies Expense
$
$