Reference no: EM132668619
Question - LEDGERS AND TRIAL BALANCE
Preparing and posting journal entries; preparing a trial balance at the beginning of April, Ahmed Khan launched a custom computer solutions company called Softworks. The company had the following transactions during April.
1. Ahmed Khan invested $65,000 cash, office equipment with a value of $5,750, and $30,000 of computer equipment in the company.
2. The company purchased land worth $22,000 for an office by paying $5,000 cash and signing a long-term note payable for $17,000.
3. The company purchased a portable building with $34,500 cash and moved it onto the land acquired in b.
4. The company paid $5,000 cash for the premium on a two-year insurance policy.
5. The company provided services to a client and immediately collected $4,600 cash.
6. The company purchased $4,500 of additional computer equipment by paying $800 cash and signing a long-term note payable for $3,700.
7. The company completed $4,250 of services for a client. This amount is to be received within 30 days.
8. The company purchased $950 of additional office equipment on credit.
9. The company completed client services for $10,200 on credit.
10. The company received a bill for rent of a computer testing device that was used on a recently completed job. The $320 rent cost must be paid within 30 days.
11. The company collected $5,100 cash in partial payment from the client described in transaction i.
12. The company paid $1,800 cash for wages to an assistant.
13. The company paid $950 cash to settle the payable created in transaction h.
14. The company paid $608 cash for minor maintenance of the company's computer equipment.
15. H. Kadir withdrew $6,230 cash from the company for personal use.
16. The company paid $1,800 cash for wages to an assistant.
17. The company paid $750 cash for advertisements on the web during April.
Required -
1. Prepare general journal entries to record these transactions (use account titles listed in part 2).
2. Make the following ledger accounts-their account numbers are in parentheses (use the balance column format): Cash (101); Accounts Receivable (106); Prepaid Insurance (108); Office Equipment (163); Computer Equipment (164); Building (170); Land (172); Accounts Payable (201); Notes Payable (250); H. Kadir Capital (301); H. Kadir Withdrawals (302); Fees Earned (402); Wages Expense (601); Computer Rental Expense (602); Advertising Expense (603); and Repairs Expense (604). Post the journal entries from part 1 to the accounts and enter the balance after each posting.
3. Prepare trial balance as of the end of April. (Hint: Trial balance totals, $141,080)