Question

D Н 1. EXCEL Assignment Number 1 KC Inc. began operations on May 1, 2018. The transactions for the first month in business are shown below: Chart of accounts The following transaction occurred in May (1) On May 1 our company issued shares common stock exchange for cash. The cash received totaled : $ Tab Color Assets: Red Use this worksheet to create a general journal to record transactions, adjusting and closing entries 250.000 Cash 101 Par value for common stock Use this worksheet to create a general ledger to post transactions, adjusting and closing entries 2 Orange Accounts receivable Prepaid insurance Office supplies 102 Shares of common stock issued 100,000 Use this worksheet to create an unadjusted trial balance Green (2) On May 2, we purchased equipment for cash. The equipment cost: 103 10 Blue Use this worksheet to create an adjusted trial balance 50,000 The estimated useful life of the property is five years. The estimated residual value of the property is: KC Inc. uses the Double-declining balance method for depreciation of equipment. Use this worksheet to create an income statement and a statement of retained earnings 104 Yellow 11 Equipment Accumulated depreciation, equipment Building Accumulated depreciation, building 105 Purple 12 Use teis worksheet to creat a balance sheet 5,000 106 13 Use this worksheet to create a post-closing trial balance Gray (3) On May 3 we purchased a building. We financing the purchase by signing a fifteen year note: 107 14 160,000 The estimated useful life of the building is twenty five years. The estimated residual value of the property is: 108 15 16 16,000 KC Inc. uses the Double-declining balance method for depreciation of the building. The annual interest rate on the note payable is: Liabilities: 17 Accounts payable Interest payable Unearned revenue Notes payable 201 18 5.0% (4) On May 4, we received cash from a customer (ABD inc.) for work to be completed in May and June: (5) On May 9 we purchased office supplies on account for: (6) On May 15 we provided service for a client (XYZ inc.) on account: (7) On May 20, we paid salaries for our staff which totaled: (8) On May 31, we paid for a twelve month insurance policy in advance: 202 19 25,000 203 20 2,200 204 21 10,000 22 7,500 Stockholders' equity: Common stock Paid in capital in excess of par value Retained earnings 23 2$ 1,500 301 302 The following information is available on May 31 25 303 Revenue earned from the May 4 transaction totaled: Office supplies on hand totaled: 26 15,000 27 1,200 Revenue: 28 Service revenue 401 Round all calculations to two decimal places 29 30 Expenses: Salaries expense Depreciation expense, equipment Depreciation expense, building Interest expense Office supplies expense 31 Instructions: 501 32 502 33 1. Record the transactions for May 1 through May 31 in a general Journal using the account names listed in the chart of accounts (red tab). 2. Post the entries to general ledger (orange tab). 3. Prepare an unadjusted trial balance on May 31, 2018 (green tab). 4. Record all necessary adjusting entries in the general journal (red tab). 5. Post the adjusting entries to the general ledger (orange tab). 6. Prepare an adjusted trial balance on May 31, 2018 (blue tab). 7. Prepare and income statement and statement of retained earnings in good form with a proper heading. 8. Prepare a balance sheet in good form with a proper heading. 9. Record the closing entries on May 31, 2018 in the general journal (red tab). 10. Post the closing entries to the general ledger (orange tab). |11. Prepare a post closing trial balance on May 31, 2018 (gray tab). 503 34 504 35 505 36 37 38 39 40 41 42 43 44 General Ledger (+ Student information Unadjusted trial balance Balance sheet General Jounral Adjusted trial balance IS and BS Post closing trial balance

Answer 1

KC Inc. Journal Enteries Date Particulars Debit in $ Credit in s May-01 Cash a/c Dr. 250000 To Common Stock 200000 To Paid in Capital in excess of par 50000 (Common stock issued) 2x 100000 = 200000 Dr. 50000 May-02 Equipment a/c To Cash (Equipment purchased) 50000 Dr. 160000 May-03 Building a/c To Note Payable (Building Purchased) 160000 Dr. 25000 May-04 Cash a/c To Unearned Revenue (Advance from client) 25000 Dr. 2200 May-09 Office Supplies a/c To Accounts Payable (Supplies on account) 2200 Dr. 10000 May-15 Accounts Receivable a/c To Service Revenue (Service on account) 10000 Dr. 7500 May-20 Salaris Expense a/c To Cash (Salary paid) 7500 Dr. 1500 May-31 Prepaid Insurance a/c To Cash (12 month insurance paid) 1500

Adjusting Enteries Date Particulars May-31 Unearned Revenue a/c To Service Revenue (Revenue recognized) Dr. Debit in $ Credit in s 15000 15000 1000 May-31 Office Supplies Expense a/c Dr. To Office Supplies (Supplies expensed) 2200 - 1200 =1000 1000 1667 May-31 Depreciation Expense Equip a/c Dr. To Accum. Depre-equip. (To record depreciation) 50000 x 2x 1/5 = 20000 / 12 = 1667 1667 1067 1067 May-31 Depreciation Expense Build a/c Dr. To Accum. Depre-Build (To record depreciation) 160000 x 2 x 1/25 = 12800 / 12 = 1067 Dr. 125 May-31 Insurance Expense a/c To Prepaid Insurance (Insurance expensed) 1500/12 125 667 May-31 Interest Expense a/c Dr. To Interest Payable (Interest accrued) 160000 x 5% x 1/12 667 Closing Enteries Date Particulars May-31 Income Summary a/c Dr. To Salaries Expense To Office Supplies Expense To Depreciation Expense Equip To Depreciation Expense Build To Insurance Expense (Expense accounts closed) Debit in $ Credit in $ 11359 7500 1000 1667 1067 125 Dr. 25000 May-31 Service Revenue a/c To Income Summary (Revenue accounts closed) 25000 Dr. 13641 May-31 Income Summary a/c To Retained Earnings (Profits transferred) 13641

Worksheet For the Month ending May 31 Unadjusted Adjustments Adjusted Post Closing Particulars Debit in $ Credit in $ Debit in $ Credit in $ Debit in $ Credit in $ Debit in $ Credit in $ Cash 216000 216000 216000 Accounts Receivable 10000 10000 10000 Office Supplies 2200 1000 1200 1200 Prepaid Insurance 1500 125 1375 1375 Building 160000 160000 160000 Accum. Depre - Build 1067 1067 1067 Equipment 50000 50000 50000 Accum. Depre-equip. 1667 1667 1667 Accounts Payable 2200 2200 2200 Interest Payable 667 667 Unearned Revenue 25000 15000 10000 10000 Note Payable 160000 160000 160000 Common Stock 200000 200000 200000 Paid in Capital in excess of par 50000 50000 50000 Retained Earnings 12974 Service Revenue 10000 15000 25000 Salaris Expense 7500 7500 Office Supplies Expense 1000 1000 Depreciation Expense Equip 1667 1667 Depreciation Expense Build 1067 1067 Insurance Expense 125 125 Interest Expense 667 667 Totals 447200 447200 19526 1 9526 450601 450601 438575 438575 667 25000 Statement of Income For the Month ending May 31 Service Revenue Less: Salaris Expense Office Supplies Expense Depreciation Expense Equip Depreciation Expense Build Interest Expense Insurance Expense Net Income 7500 1000 1667 1067 667 125 12026 12974 Statement of Retained Earnings For the Month ending May 31 Net Income 12974

Amounts in $ Amounts in $ 2200 10000 667 12867 Balance sheet As at May 31 Assets Amounts in $ Amounts in $ Liabilities Current Assets Current Liabilities Cash 216000 Accounts Payable Accounts Receivable 10000 Unearned Revenue Office Supplies 1200 Interest Payable Prepaid Insurance 1375 228575 Non Current Liabilities Note Payable Non Current Assets Building 160000 Shareholders Equity Accum. Depre - Build -1067 158933 Common Stock Equipment 50000 Paid in Capital in excess of par Accum. Depre-equip. -1667 48333 Retained Earnings Total Assets 435841 Total Liabilities & Equity 160000 200000 50000 12974 262974 435841