See Below, Financial Accounting

 

John’s House Painting Company has the following transactions for the year

   

1.  December 1 – Issued capital stock for $100,000 to start a house painting                                              business. 

   

2. December 1 – Paid one year insurance premium costing $4,800.           

   

3.  December 1 – Paid gas expense $200.

   

4.  December 1 – Purchased equipment costing $4,800 on credit.

   

5.  December 12 – Purchased supplies costing $800 on credit.

   

6.  December 18 – Painted three houses totaling $12,000 and billed customers. 

   

7.  December 23 – Painted three rooms and billed customers $500.

   

8.   December 28 – Received $2,000 for houses painted in #6.

   

9.  December 31 – Paid for equipment purchased in #4.

   

10.  December 31 – Received $1,000 for a job to paint a house in January next year.

   

11.  December 31 – Paid a $1,000 dividend.

   

Required:

   

1.  Prepare journal entries for the above transactions.  

   

2.  Post the above transactions to T Accounts.

   

3.  Prepare a Trial Balance.

   

4.  Prepare adjusting entries in journal format and post to T Accounts.

   

Supplies on Hand December 31 was $400.

   

The Equipment is to be depreciated over 48 months starting with December. 

 

(HINT;             Record one month depreciation expense).

   

Wages owed but not paid on December 31 was $200.

   

One month of insurance has expired. 

   

5.  Prepare an Adjusted Trial Balance.

   

6.  Prepare an Income Statement, Statement of Retained Earnings and a Balance Sheet.

   

7.  Prepare closing entries in journal format and post to the T Accounts.

   

8.  Prepare a Post-Closing Trial Balance.