Jill Wahpoosywan opened a computer consulting business called Techno Wizards and completed the…

 
   

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Jill Wahpoosywan opened a computer consulting business called Techno Wizards and completed the following transactions during May 2014: May 1 Jill Wahpoosywan invested $75,000 in cash and office equipment that had a fair value of $48,000 in the business. 1 Prepaid $14,400 cash for three months’ rent for an office. 2 Made credit purchases of office equipment for $24,000 and office supplies for $4,800. 6 Completed services for a client and immediately received $8,000 cash. 9 Completed a $16,000 project for a client, who will pay within 30 days. 10 Paid half of the account payable created on May 2. 19 Paid $7,500 cash for the annual premium on an insurance policy. 22 Received $12,800 as partial payment for the work completed on May 9. 25 Completed work for another client for $5,280 on credit. 25 Paid wages for May totalling $34,000. 31 Wahpoosywan withdrew $5,000 cash from the business for personal use. 31 Purchased $1,600 of additional office supplies on credit. 31 Paid $1,400 for the month’s utility bill. Required 1. Prepare General Journal entries to record the transactions. Use page 1 for the journal. 2. Set up the following accounts (use the balance column format or T-accounts): Cash (101); Accounts Receivable (106); Office Supplies (124); Prepaid Insurance (128); Prepaid Rent (131); Office Equipment (163); Accounts Payable (201); Jill Wahpoosywan, Capital (301); Jill Wahpoosywan, Withdrawals (302); Services Revenue (403); Wages Expense (623); and Utilities Expense (690). 3. Post the entries to the accounts and enter the balance after each posting. 4. Prepare a trial balance at May 31, 2014. Analysis Component: Utilities Expense, Services Revenue, and Jill Wahpoosywan, Withdrawals are equity accounts. Explain why. View Solution:
Jill Wahpoosywan opened a computer consulting business called Techno Wizards