Question

At June 30, 2018, the end of its most recent fiscal year, River Consultants Ltd.'s post-closing trial balance was as follows: Credit Cash Debit $15,900 1,100 600 Accounts receivable Supplies Accounts payable Income tax payable Unearned revenue Common shares Retained earnings $500 500 1,200 3,200 12,200 $17,600 $17,600 The company underwent a major expansion in July. New staff was hired and more financing was obtained. River conducted the following transactions during July 2018. July 3 Issued $9,700 of common shares for cash. 4 Purchased insurance coverage for a year, $3,720. 5 Paid the first two (July and August 2018) months' rent for an annual lease of office space for $4,100 per month. (Hint: Use the Prepaid Rent account.) 6 Purchased $4,100 of supplies for cash. 6 Purchased equipment, paying $3,600 cash and signing a two-year bank loan for $20,400. The equipment has a four-year useful life. The bank loan has a 6% interest rate, which is payable on the first day of each following month. 10 Visited client offices and agreed on the terms of a consulting project. River will invoice the client, Connor Productions Ltd., on the 19th of each month for work performed. 12 Collected $1,100 on account from Milani Brothers Ltd. This client was invoiced in June when the service was provided. 13 Completed services for Mactaquac Inc. This client paid $1,200 in advance last month. All services relating to this payment are now completed. (Hint: Use the Fees Earned account.) 16 Paid salaries for the first half of the month, $10,400 17 Paid a utility bill of $500. This related to June utilities that were accrued at the end of June. 18 Met with a new client, Bay Technologies. Received $12,300 cash in advance for future work to be performed. 19 Invoiced Connor Productions for $29,200 of consulting fees provided on account. (Hint: Use the Fees Earned account.) 20 Received an invoice for legal advice, $2,400. The amount is not due until August 20. (Hint: Use the Professional Fees Expense account.) 23 Completed the first phase of the project for Bay Technologies Ltd. Recognized $9,700 of revenue from the cash advance previously received (see July 18 transaction). 25 Paid $500 income tax payable owing at the end of June, in addition to $1,300 for the July income tax instalment. 27 Received $16,100 cash from Connor Productions in partial payment of the invoice issued on July 19. 30 Declared and paid a $4,500 dividend.

Answer 1

Adjustment Journal Entries:
Date	Acc/ Titles	Debit $	Credit $
1	Insurance expense	310		(3720/12)
	Prepaid insurance		310
	(insurance expense recorded)
2	Rent expense	4100
	Prepaid rent		4100
	(rent expense recorded)
3	Supplies expense	1300
	Supplies		1300
	(supplies expense recorded)
4	Depreciation expense-Equip.	500		24000/(4*12)
	Acc. Depreciation-Equip.		500
	(depreciation expense recorded)
5	Interest expense	102		(20400*6%/12)
	Interest payable		102
	(interest expense recorded)
6	Salaries and Wages expense	10400
	Salaries and Wages payable		10400
	(salaries expense made payable)
7	Utilities expense	700
	Accounts payable		700
	(utilities expense recorded and made payable)