Learning Objectives 4, 5, 6: Analyze the impact of business transactions on accounts; record (journalize and...

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Accounting

Learning Objectives 4, 5, 6: Analyze the impact of businesstransactions on accounts; record (journalize and post) transactionsin the books; construct and use a trial balance) During the firstmonth of operation of Gordon Construction, Inc., completed thefollowing transactions: June 2 Gordon received $55,000 cash andissued common stock to the stockholders. 3 Purchased supplies,$3,000, and equipment, $5,200, on account. 4 Performed services fora client and received cash, $6,300. 7 Paid cash to acquire land,$37,000. 11 Performed services for a customer and billed thecustomer, $1,200. Johnson expects to collect within one month. 16Paid partial for the equipment purchased June 3 on account $2,800.17 Paid the telephone bill, $230. 18 Received partial payment fromcustomer on account, $700. 22 Paid the water and electricity bills,$400. 29 Received $5,000 cash for repairing the pipes of acustomer. 30 Paid employee salary, $4,300. 30 Declared and paiddividends of $3,000. ?Requirements • 1. Record each transaction inthe journal. Key each transaction by date. Explanations are notrequired. • 2. Post the transactions to the T-accounts, usingtransaction dates as posting references. • 3. Prepare the trialbalance of Gordon Construction, Inc., at June 30, 20xx. • 4. Themanager asks you how much in total resources the business has towork with and, how much it owes. Case Study 1 (Part B) Requirement2 (Learning Objectives 3, 4: Adjust the accounts; construct thefinancial statements) Record the following month end adjustingentries for Gordon Construction, Inc. at June 30, 20xx Month endaccruals at June 30, 20xx: • a. Accrued advertising revenue at June30, $3,100. • b. Supplies used during June, $2,300. • c. Accruedsalary expense at June 30 for Monday, Tuesday, and Wednesday. Thefive-day weekly payroll is $6,100 and will be paid on Friday.Requirement 2 Prepare adjusted trial balance for GordonConstruction at June 30, 20xx. How much are the total resources?How much does the business owe? How much profit was made inJune?

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SOLUTION:-

Journal Entries:

Date Account Title Debit Credit
June-2 Cash 55,000
Commom Stock 55,000
(Recording of issue of common stock)
June-3 Supplies 3,000
Equipment 5,200
Account Payable 8,200
(Recording of purchase of supplies and equipment)
June-4 Cash 6,300
Revenue 6,300
(Recording of Revenue)
June-7 Land 37,000
Cash 37,000
(Recording of Purchase of Land)
June-11 Account Receivable 1,200
Revenue 1,200
(Recording of services performed on account)
June-16 Account Payable 2,800
Cash 2,800
(Recording of Payment made)
June-17 Telephone Expenses 230
Cash 230
(Recording of Payment of Telephone Expenses)
June-18 Cash 700
Account Receivable 700
(Recording of collection of Cash)
June-22 Electricity and Water Expenses 400
Cash 400
(Recording of Payment of Bills)
June-29 Cash 5,000
Revenue 5,000
(Recording of Cash received)
June-30 Salary 4,300
Cash 4,300
(Recording of payment of Salary)
June-30 Retained Earnings 3,000
Cash 3,000
(Recording of Declaration and Payment of Div.)

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