Question

At the beginning of Year 1, Oak Consulting had the following normal balances in its accounts:

Account	Balance
Cash	$	29,200
Accounts receivable		16,400
Accounts payable		12,200
Common stock		20,200
Retained earnings		13,200

The following events apply to Oak Consulting for Year 1:

1. Provided $74,500 of services on account.
2. Incurred $3,000 of operating expenses on account.
3. Collected $50,000 of accounts receivable.
4. Paid $36,000 cash for salaries expense.
5. Paid $13,680 cash as a partial payment on accounts payable.
6. Paid a $8,600 cash dividend to the stockholders.

f. Prepare a post-closing trial balance.

	OAK CONSULTING Post-Closing Trial Balance As of December 31, Year 1 Account Titles Debit Credit Cash Accounts receivable Accounts payable Common stock Retained earnings Totals $0 $0

Answer 1

Solution

OAK CONSULTING
Post-Closing Trial Balance
As of December 31, Year 1
Account Titles	Debit	Credit
Cash	$   20,920.00
Accounts receivable	$   40,900.00
Accounts payable		$      1,520.00
Common stock		$   20,200.00
Retained earnings		$   40,100.00
Total	$   61,820.00	$   61,820.00

Working

Transactions	Cash	Accounts receivable	Accounts payable	Common stock	Retained earnings
Beginning balances	$   29,200.00	$   16,400.00	$   12,200.00	$ 20,200.00	$   13,200.00
1		$   74,500.00			$   74,500.00
2			$      3,000.00		$   (3,000.00)
3	$   50,000.00	$ (50,000.00)
4	$ (36,000.00)				$ (36,000.00)
5	$ (13,680.00)		$ (13,680.00)
6	$   (8,600.00)				$   (8,600.00)
Ending balances	$   20,920.00	$   40,900.00	$      1,520.00	$ 20,200.00	$   40,100.00