Prepare financial statements for the month

Assignment Help Accounting Basics

Reference no: EM131972299

Problem

Salem Company started its operations on January 1, 2016. The following transactions took place during the first month of operations:

Jan 1: Salem invests $480,000 cash to start the business.

Jan 5: Purchased furniture for $72,000, paying $18,000 in cash and sign a note for the remaining balance.

Jan 8: Purchased supplies for $3,600 on credit.

Jan 12: Paid $6,300 cash for January rent.

Jan 18: Paid $1,800 cash for office supplies purchased on January 8.

Jan 24: Services billed to customers amount to $36,000.

Jan 25: Received utility bills for $5,400 for the month of January.

Jan 27: Paid $19,800 cash for salaries.

Jan 29: Received $27,000 cash from customers in payment for services billed on January 24.

Jan 31: Salem withdrew $10,100 from the business for personal use.

Required:

1- Prepare Journal entries to record the above transactions.

2- Post to the appropriate ledger accounts.

3- Prepare the trial balance.

4- Prepare financial statements for the month.

Reference no: EM131972299

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