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

$

$