90.2K

Verified Solution

Link Copied!

A group of college graduates decided to start a tutoring school business called MscBM Incorporation on Sep 1, 2021. The following activities occurred in the month of September. Sep 1 The college graduates contributed $100,000 into the tutoring school in exchange for capital stock; Sep 2 MscBM Incorp. bought $500 worth of supplies including pens and paper in cash, and bought a printing machine for $15,000 by taking out a 1-year note payable from HSBC with 12% interest rate. Sep 5 MscBM Incorp. hired 2 full time employees to hold classes with a wage of $500 per class for each employees. The first payment of their wage is October 5, 2021. Sep 15 MscBM Incorp. successfully recruited 10 students, who prepaid in advance for 10 tutoring sessions, with a tuition fee of $70 each student for each session. The company uses the following accounts for accounting purposes. Cash Supplies Equipment Accumulated Depreciation-Equipment Notes Payable Unearned Revenue Salaries and Wages Payable Interest Payable Capital Stock Revenue Depreciation Expense Supplies Expense Salaries and Wages Expense Interest Expense Income Summary Retained Earnings A. Prepare the journal entries for the transactions in September. B. Post the entries to ledger accounts using the running balance format. C. Prepare the trial balance on Sep 30, 2021.

D. The firm does adjusting entries every month. Prepare all the necessary adjusting entries at the end of September. The following additional information is available to the accountant. Depreciation expenses relating to the printing machine is $100 for September. A physical count of the supplies left on September 30th show $400 worth of things left. The 2 employees each taught 2 tutoring sessions in September. The 10 students all attended 4 tutoring sessions in September. E. Post the adjusting entries to the general ledger using the running balance format. F. Prepare the adjusted trial balance on September 30, 2021. G. MscBM Incorp. decides to have fiscal year end on September 30 every year. Prepare Income Statement and Statement of Retained Earnings for the month of September 2021 (because the firm has only been set up for a month), as well as the Balance Sheet on September 30, 2021. H. Prepare the closing entries after the financial statements are done on September 30, 2021. I. Post the closing entries to the general ledger using the running balance format. J. Prepare the post-closing trial balance.

Answer & Explanation Solved by verified expert

See Answer